Chapter 13 - Assignment 2: The Bimetallic Standard and Gresham's Law

Read François Micheloud's discussion of "The Bimetallic Standard." (Browse through all of the pages listed on the menu on the left.)

  1. Carefully explain how Gresham's Law may apply when a bimetallic standard is used.
  2. Why did the relative price of gold rise beginning in the 1870s?
  3. Explain why the relative prices of gold and silver remained stable throughout the first 70 years of the 19th century.
  4. Why was a bimetallic monetary standard replaced by a gold standard in the latter part of the 19th century?
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