The Goldsmith's Ability to Create Money Was Based on the Fact

question 77

Multiple Choice

The goldsmith's ability to create money was based on the fact that:

• A)withdrawals of gold tended to exceed deposits of gold in any given time period.
• B)consumers and merchants preferred to use gold for transactions, rather than paper money.
• C)the goldsmith was required to keep 100 percent gold reserves.
• D)paper money was rarely redeemed for gold.

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Definitions:

Total Fixed Cost

The total of all expenses that stay unchanged no matter the production volume or output in the short term.

Total Variable Cost

The total of all costs that vary directly with the level of output or production in the short term.

Output

The total amount of goods or services produced by a company, industry, or economy, often measured within a given time period.

Shut Down

The temporary or permanent cessation of operations, often due to economic, financial, or market conditions, prompting a business to stop production or close.