The collapse of which of the following systems is related to the Triffin Paradox ?
Economist Robert Triffin (1960) formulated the Triffin Paradox (Triffin Dilemma) to explain the structural vulnerability that led to the collapse of the 'Bretton Woods'…
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The collapse of which of the following systems is related to the Triffin Paradox ?
Answer and explanation
Correct answer C
Economist Robert Triffin (1960) formulated the Triffin Paradox (Triffin Dilemma) to explain the structural vulnerability that led to the collapse of the 'Bretton Woods' fixed exchange rate system in 1971. Because the US dollar served as the global reserve currency pegged to gold at $35/oz, supplying world liquidity required persistent US Balance of Payments deficits, which inevitably undermined global confidence in the dollar's gold convertibility.
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UGC NET Commerce