--%>
Assignment Help - homework help

Advantages and disadvantages of gold standard

Write the advantages and disadvantages of the gold standard.

E

Expert

Verified

Advantages of the gold standard involves: 

a) As supply of gold is controlled, countries do not have high inflation; 

b) Any of BOP disequilibrium may be corrected through the cross-border flows of the gold.

While, the major disadvantages of gold standard are as: 

a) The world economy may be subjected to the deflationary pressure due to restricted gold supply; 

b) The standard of gold itself does not have any mechanism for enforcing rules of game, and, consequently, countries can pursue economic policies which are incompatible with standard of gold.

   Related Questions in Financial Accounting

  • Q : Firm cross-listed on foreign stock

    Explain why and how a firm’s capital cost can be reduced when stock of firm is cross-listed on foreign stock exchanges.

    		•
  • Q : What is Offshore banking center What is

    What is offshore banking center?

    		•
  • Q : Causes of current account deficits

    United States has experienced constant current account deficits since early 1980s. List some of the major causes of the deficits? What could be the consequences of these constant U.S. current account deficits?

    		•
  • Q : Financial hedging of firm’s operating

    List disadvantages and advantages of the financial hedging of firm’s operating exposure through the operational hedges (like relocating the manufacturing site)?

    		•
  • Q : Corruption of Creativity Explain the

    Explain the Corruption of Creativity in Creative Industry ? Explain in brief.

    		•
  • Q : Acc company A began operation on

    company A began operation on january 1,2012. The annual reporting period ends December 31.The trial balance on January 1,2013 was as follows

    		•
  • Q : Cause why relationships tend to come

    Identify and briefly explain the patterns in terms of how relationships tend to come apart (not together) or deteriorate. Use a real or hypothetical illustration to describe each of such phases.

    		•
  • Q : Capital budgeting analysis State some

    State some of the problems which may enter into capital budgeting analysis in case project debt is computed rather than borrowing capacity made by the project?

    		•
  • Q : Cash flows from operating activities A

    A financial analysis tools that measures the need for financing. The formula is the cash-flow from operating activities divided by the cash paid for long-term asset. Cash paid for long-term assets can be found on the statement of cash-flow, in the investing-activities

    		•
  • Q : Functions of Bank Write some of the

    Write some of the functions of Bank?

    		•