Why Did Britain's Abandonment of the Gold Standard Not Aid

question 51

Multiple Choice

Why did Britain's abandonment of the gold standard not aid its recovery?

• A)Its gold reserves were so large from its colonial possessions that it undermined the efforts to create a free-floating currency.
• B)After industrialization, gold played a small role in the world economy.
• C)Many other wealthy countries abandoned the gold standard after Britain, blunting any advantage for Britain.
• D)The lack of bank regulations and currency controls resulted in a currency that already was devalued.

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Definitions:

Tax Obligations

The legal requirement for individuals or entities to pay taxes to governmental authorities according to the laws in place.

Economic Life

Refers to the length of time an asset is expected to be usable for its intended purpose or until it is more cost-effective to replace it.

Sale and Leaseback Arrangement

A financial transaction where one sells an asset and leases it back for the long term; thus, one continues to use the asset but no longer owns it.