第 48 至 51 題為題組
       In finance, an exchange rate is the rate at which one country’s currency is exchanged for the currencyof another. The rate is set according to the respective values of the currencies to be exchanged. BeforeWorld War I, most currencies were evaluated by the Gold Standard. That is, paper currency issued by agovernment represented a real amount of gold held by that government. For example, in the 1930s, theBritish government owned about 8 times as much gold as the U.S. government. Therefore, 1 ounce of goldwas worth 4.24 GBP (United Kingdom pound sterling) or 35 USD (U.S. dollars). The difference in theprice of gold became the exchange rate for the two currencies: 1GBP was worth 8.25 USD.
       The Gold Standard started to break down during the Second World War, when European powersprinted more money than they had in gold reserves in order to fund military projects. After World War II,the Bretton Woods System was established. The U.S. dollar was chosen as the international reservecurrency for trading. Every country knew how much gold a USD was worth, and thus they based the valueof their currencies on the USD. All countries were expected to maintain a fixed exchange rate, but werepermitted to change it in extraordinary times, such as a recession or inflation.
       Unfortunately, this system could not keep pace with the fast-changing global economy. As the U.S.increased its military spending, foreign aid, and international investment in the 1960s, it no longer heldgold reserves necessary to cover the volume of USD circulation around the world. Other major currenciesthus became more valuable and stable compared to the USD, and the Bretton Woods System was finallyabolished in 1971.
       In 1976, the Jamaica Agreement formalized the floating exchange rate system that continues to thisday. The value of a country’s currency may vary according to the supply and demand of the foreignexchange market. Countries around the world can also allow their central banks to determine their ownexchange rate.
【題組】48. According to the passage, which of the following is true about the Gold Standard?
(A) It showed the importance of gold for currency exchange.
(B) It reflected the dominance of the U.S. economy in the world.
(C) It demonstrated how rich countries manipulated exchange rates.
(D) It decided that the GBP was worth less than the USD in the 1930s.