Which of the following statements is true about the gold standard? A.

QUESTION

Which of the following statements is true about the gold standard?

A. Given a common gold standard, the value of any currency in units of any other currency was easy to determine.

B. Establishing a gold standard seemed impractical as the volume of international trade expanded in the wake of the Industrial Revolution.

C. A drawback of the gold standard was that it failed to provide a mechanism for achieving balance-of-trade equilibrium by all countries.

D. Under the gold standard, when a country has a trade deficit, there will be a net flow of gold from the other countries to that country.

E. The gold standard refers to the use of gold coins as a medium of exchange between countries involved in international trade.

ANSWER

A