Question

select the correct answer
which of the following is a definition of the gold standard?
a. indicator of the highest credit rating
b. variable currency based on the price of gold
c. weight of gold bullion
d. purity of gold bullion
e. currency based on the price of gold

Explanation:

The gold standard is a monetary system where a country's currency is directly linked to a fixed quantity of gold, meaning its value is tied to the price of gold. Option A refers to credit ratings, unrelated to the gold standard. Option C describes a physical measurement of gold, not the monetary system. Option D refers to gold purity, which is not the definition of the gold standard. Option B incorrectly uses "variable currency"—the gold standard typically involves a fixed link, not variable. Option E correctly states it is currency based on the price of gold.

Answer:

E. currency based on the price of gold