1. Explain reason's for the demise of Bretton Woods System.

ANSWER KEY:

a. Briefly explain Bretton Woods System, managed exchange rate regime, establishment of the IMF and WB;

b. Developments with regards to the US economy, high budget deficit; c. Oil price hikes,

d. euro-dollars and increased international debt and inflation;

e. floating the value of USD against gold and the hence end of Bretton Woods System.