09 Jul International Business. P3.

Please read the instructions carefully (Directions for thisEssay, Opinions, and Guidelines sections). Do not bid on this order unlessyou are absolutely sure you can deliver exceptional work.

Directions for this Essay:
-Read the opinions given below by another person in answer to two questionsregarding an International Monetary System based on gold and implementing aglobal version of the European Monetary System.
-After reading the opinions given by that person, respond to the followingquestions in a one-page essay:

1)      Do you agree with the opiniongiven to question # 1? Why or why not?

2)      Do you agree with theopinion given to question # 2? Why or why not?

Opinions:

Question # 1: Do you think an international monetarysystem with currencies valued on the basis of gold would work today? Whyor why not? 

Opinion: Suppose the international monetary system is thestandard economic unit of account based on gold. In these countries, thecurrency would be linked to gold, and the value of a countrys paper moneywould also be linked to gold. Therefore, the gold standard would lead to more prevalentperiods of inflation and deflation. This is because the value of a currencywill depend on gold discoveries. For example, if there is a significantdiscovery of gold, it will lead to more currency, which will lead to inflation.However, if gold discoveries reduce or fall drastically, then growth in themoney supply will slow down, leading to deflation. In addition, the bankingsystem will become more prone to crisis and instability. While new unregulatedentities will crop up, putting an immense risk on the financial and bankingstructure.

Question # 2: Do you think implementing a global versionof the old European monetary system would work today? Why or why not? 

Opinion: Implementing a system similar to the Europeanmonetary system on a global scale would be a difficult task. Economies withhighly disparate economic conditions would find it challenging to addressdomestic economic problems that could be dealt with efficiently at the nationallevel. The worlds industrialized economies could develop a system similar tothe European monetary system, but without including the least developedeconomies. Thus, without the worlds poorest countries in line economicallywith the worlds most advanced economies would be practically impossible.Furthermore, the vast amounts of subsidies to the poor economies could severelydrain the resources of the worlds most industrialized countries.

Guidelines:
-Do not use Wikipedia as a reference.
-Please put together complete and well-thought-out responses. Original input isgreatly appreciated it, so please integrate your thoughts and experiences inthe essay.
-Also, answer the questions completely. Quality counts, so be brief thoroughand to the point.