The architects of the Bretton Woods agreement wanted to avoid high une

QUESTION

The architects of the Bretton Woods agreement wanted to avoid high unemployment, so they built the fixed exchange rate system to be highly inflexible.

Indicate whether the statement is true or false.

ANSWER

FALSE
Although monetary discipline was a central objective of the Bretton Woods agreement, it was recognized that a rigid policy of fixed exchange rates would be too inflexible. The architects of the Bretton Woods agreement wanted to avoid high unemployment, so they built limited flexibility into the system.