In the late 1800s, why did industrialists support the gold standard?

a) The gold standard kept the price of gold flexible, which made the value of currency go up and down.

b) The gold standard kept the price of gold fixed, which kept both prices and wages down.

c) The gold standard kept the price of gold fixed, which caused wages to steadily increase.

d) The gold standard kept the price of gold flexible, which also made the price of silver flexible.

Question

History

Karsyn Little

16 November, 15:35

In the late 1800s, why did industrialists support the gold standard?

a) The gold standard kept the price of gold flexible, which made the value of currency go up and down.

b) The gold standard kept the price of gold fixed, which kept both prices and wages down.

c) The gold standard kept the price of gold fixed, which caused wages to steadily increase.

d) The gold standard kept the price of gold flexible, which also made the price of silver flexible.

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Answers (1)

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Alejandra Lopez · Answer 1

During the 1880s, the gold standard was introduced because of the increase in World trade and the industrial development within America. The gold standard was adopted as it removed the risk of fluctuations within different countries currencies within international trade and businessmen were able to make important decisions with the knowledge of what the exchange rates were.

Another reason was that the gold standard was used was because it stopped governments from increasing inflation by issuing paper money which was not supported by gold.