Question

1, When Bretton Woods ended, what happened to the price of gold?

Select one:

a. The price of gold decreased in dollars.

b. The price of gold increased in dollars.

2,

Following the demise of the Bretton Woods system, the IMF

a. The IMF became the central bank of the United Nations.

b. The IMF created a new role for itself, providing loans to countries facing balance-of-payments and exchange rate difficulties.

c. The IMF ceased to exist, since the era of fixed exchange rates had ended.

d. The IMF became the sole agent responsible for maintaining fixed exchange rates.

3,

Once the changeover to the euro was completed by July 1, 2002, the legal-tender status of national currencies in the euro zone

a. was tied to gold.

b. was affirmed at the fixed exchange rate at that time.

c. was canceled, leaving the euro as the sole legal tender in the euro zone countries.

4, In the United States, managers are legally bound by the "duty of loyalty" to

a. the employees.

b. the government.

c. A fiduciary loyalty is owed to all the stakeholders.

d. the shareholders.

e. the bondholders.

5,

The difference between a broker and a dealer is

a. Brokers bring together buyers and sellers, but carry no inventory; dealers stand ready to buy and sell from their inventory.

b. Brokers transact in stocks and bonds; currency is bought and sold through dealers.

c. Brokers have their firm's money at risk.

Answer 1

1) Answer is b. The prices of gold increased in dollars.

The reason behind is that in 1971 when NIxon seperated the value of dollar from gold, which increased the prices of gold to $120 per ounce in the free market which leads to end of the Bretton Woods system.

2) Answer is b. The IMF created a new role for itself, providing loans to countries facing balance-of-payments and exchange rate difficulties.

With the end of Bretton Woods, IMF regulates the exchange rate, started advising countries on monetary policies and lending countries to nations with balance of payment debt.

3) Answer is c. was canceled, leaving the euro as the sole legal tender in the euro zone countries.

The option is selected as in July 1, 2002 when the switchover to euro was completed, the national currencies of the member nations lose their legal tender which was completely replaced by euro for all cash and currency transactions.

4) Answer is d. to the shareholders

Managers have a duty towards shareholders for maximizing their wealth.