Week 5: Supplementary Resources - The History of Bretton Woods

Question 1

In August 1971 President ______ imposed price and wage controls, closed the gold window to foreign central banks, and imposed a surcharge on imports. (bretton woods supp article)

Answer 1

(Nixon)

Question 2

What ultimately caused the end of the Bretton Woods system in 1973?
a) Speculative attacks on the dollar and foreign governments allowing their currencies to float
b) The U.S. increasing its gold reserves
c) Increased international trade competition
d) New gold discoveries that flooded the market

Answer 2

a) Speculative attacks on the dollar and foreign governments allowing their currencies to float

Question 3

What did the Bretton Woods system initially rely on to maintain stability?

a) Floating exchange rates
b) Fixed exchange rates pegged to the U.S. dollar and gold
c) Free trade agreements
d) Foreign investment

Answer 3

b) Fixed exchange rates pegged to the U.S. dollar and gold

Question 4

Why did European countries devalue their currencies after World War II?
a) To increase inflation
b) To boost their net exports and earn more dollars
c) To reduce their gold reserves
d) To reduce international trade

Answer 4

b) To boost their net exports and earn more dollars

Question 5

Which administration introduced the national policy to achieve full employment with a 4% unemployment rate?

a) Johnson administration
b) Kennedy administration
c) Nixon administration
d) Truman administration

Answer 5

b) Kennedy administration