History of Philippine Currency & Monetary Standards
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Questions and Answers

What are the two main classifications of monetary standards?

  • Gold and silver
  • Fiat and commodity
  • Commodity and non-commodity
  • Commodity standard and metallic standard (correct)

    • What is a monetary standard?

  • A system for controlling the value of a country's currency
  • A method for determining the exchange rate between currencies
  • A way to ensure that all countries use the same currency
  • A set of rules governing the supply of money in an economy (correct)

    • What is a commodity standard?

  • A system where the government controls the supply of money
  • A standard that allows for the free exchange of currencies
  • A system where the value of the currency is determined by market forces
  • A monetary system where the value of the currency is tied to a specific commodity or set of commodities (correct)

    • What are the two types of commodity standards mentioned in the text?

    <p>Gold standard and silver standard</p> Signup and view all the answers

    What are the three types of gold standards mentioned in the text?

    <p>Gold coin standard, gold bullion standard, and gold exchange standard</p> Signup and view all the answers

    Which statement accurately describes the gold coin standard?

    <p>The government defines the monetary unit as a specific weight and fineness of gold.</p> Signup and view all the answers

    What are the three types of silver standards mentioned in the text?

    <p>Silver coin standard, silver bullion standard, and silver exchange standard</p> Signup and view all the answers

    What is the key difference between the gold coin standard and the gold bullion standard?

    <p>The gold coin standard defines the monetary unit in terms of gold coins, while the gold bullion standard defines it in terms of gold bars.</p> Signup and view all the answers

    What is the primary advantage of the gold bullion standard over the gold coin standard?

    <p>It stretches existing supplies of gold to support the international monetary system.</p> Signup and view all the answers

    Which statement accurately describes a characteristic of the gold bullion standard?

    <p>The monetary authority is not obligated to buy and sell gold at a fixed price.</p> Signup and view all the answers

    Which economist first suggested the idea of the gold bullion standard?

    <p>David Ricardo</p> Signup and view all the answers

    What was the official United States price of gold per ounce when it was on the gold bullion standard from the 1930s until 1971?

    <p>$35 per ounce</p> Signup and view all the answers

    Study Notes

    Monetary Standard in the Philippines

    • A country's monetary standard refers to the rules and institutions governing the supply of money in its economy.
    • The standard indirectly affects prices and can influence the rate of growth of real economic output, depending on expectations.

    Classifications of Monetary Standard

    • Commodity Standard: A monetary system where the purchasing power or value of the monetary unit is equal to the value of a designated quantity of a particular commodity or set of commodities.

    Monometallic Standard

    • Gold Standard: A monetary system where the value of the monetary unit is equal to the value of a designated quantity of gold.
      • Gold Coin Standard: A country allows the conversion of gold bullions into coins, which are freely obtained by citizens in exchange for other forms of money.
        • Characteristics:
          • Monetary unit is stated in a definite weight and fineness of gold.
          • People are free to convert their bullions into coins.
          • Gold can be used in any manner.
          • Gold can be freely imported and exported.
          • All other kinds of money and bills are exchangeable to gold coins.
          • Money supply is determined by the amount of gold reserves.
          • Free coinage of gold, where citizens can convert gold bullions into coins.
          • Free market of gold, where people are free to import and export gold.
      • Gold Bullion Standard: A country holds reserves of gold in the form of bars rather than coins, removing gold from monetary circulation.
        • Characteristics:
          • Monetary unit is defined in terms of certain weight and fineness of gold.
          • All gold coins are held as standard coins and considered unlimited legal tender.
          • All other types of money are freely convertible into gold or equivalent of gold.
          • Unlimited coinage of gold at no cost.
          • Free and unlimited melting of gold.
          • Import and export of gold is freely allowed.
          • Monetary authority is under permanent obligation to buy and sell gold at the fixed price without limit.

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    Description

    Explore the history of Philippine currency and the establishment of monetary standards in the Philippines. Learn about the rules and institutions governing money supply in the economy.

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