Difference between gold standard and gold exchange standard in ignou
Answers
Gold Standard is a defunct monetary system in which, the currency or the economic unit of account of a country is based on a fixed quantity of gold.
Gold Exchange Standard is a type of Gold Standard which does not cover circulation of gold coins. Under this the government guarantees a fixed exchange rate to the currency of another country, that uses a Gold Standard.
The gold standard is the term applied only when the coin has a value which is more than the value of the basic metallic content of the coin.
Gold exchange standard is how gold standards move in this millennium.
One of the basic characteristics of a gold standard is to hold gold reserves.
When foreign exchange reserves are held and they are used in order to discharge various obligations in the global scenario thy form the true characteristics of gold exchange standards.