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22 July, 19:42

Proponents of the gold standard often argue that the gold standard will

cause the price level to decrease.

cause the price level to increase.

stabilize the price level.

lead to Inflation

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  1. 22 July, 20:45
    0
    Proponents of the gold standard often argue that the gold standard will stabilize the price level.

    Explanation:

    Prior to 1971, the USA was in different gold standards, in which the value of the dollar could be exchanged for gold on demand with gold reserves and paper currency. Until 1971, the US dollar has become a national currency supported by the governments "full compensation and confidence" and not sponsored, priced or exchanged into gold.

    Gold standard proponents contend that it gives long-term economic growth and stability, avoids inflation, and reduces government size. Critics argue that a gold standard will limit the government's ability to issue cash at will, raise huge deficits, and boost national debt. They believe the economy has been stronger underneath a gold standard traditionally.
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