What are the Advantages of Monometallism?


The following are the main advantages of monometallism:

1. It is a very simple form of monetary standard, as only one metal is used as a standard of value.

2. Since monometallism takes the form of either the Silver Standard or the Gold Standard, it easily wins public confidence.


3. Since the Silver or Gold Standard can easily be recognised as an international means of payment, monometallism helps in promoting the country’s foreign trade.

4. As compared to bimetallism, it provides little scope for the operation of Gresham’s Law (that bad money tends to drive out of circulation good money).

5. It makes the supply of money self-operative. If there is over-expansion of money supply so that the value of money tends to decline, people will start converting (melting) coins into metal and thereby the surplus of money is wiped out, once again bringing money supply in a balanced form.

Web Analytics
Kata Mutiara Kata Kata Mutiara Kata Kata Lucu Kata Mutiara Makanan Sehat Resep Masakan Kata Motivasi obat perangsang wanita