The Gold Standard Was Dissolved in 1973 Because

question 17

Multiple Choice

The gold standard was dissolved in 1973 because

• A)the U.S.printed too many dollars to maintain gold at $35/oz
• B)exchange markets preferred a floating rate system
• C)high interest rates raised the cost of holding gold
• D)some countries preferred to hold gold instead of dollars

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Definitions:

Input Markets

Markets where factors of production (such as labor, materials, and capital) are bought and sold.

Equilibrium

A state in a market where supply equals demand, and there is no external pressure to change the price or quantity.

Wheat Industry

A sector of the economy focused on the production, processing, and distribution of wheat and wheat-based products.

Partial Equilibrium Analysis

The process of examining the equilibrium conditions in individual markets and for households and firms separately.