Assume that a country is on the gold standard. In order to support unrestricted convertibility into gold, banknotes need to be backed by a gold reserve of some minimum stated ratio. In addition, Multiple Choice the central bank can control the money supply by buying or selling the foreign currencies. the domestic money stock should rise and fall as gold flows in and out of the country and the central bank can control the money supply by buying or selling the foreign currencies. none of the options the domestic money stock should rise and fall as gold flows in and out of the country.
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Assume that a country is on the gold standard. In order to support unrestricted convertibility into...
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