Examkin

Question

Difficulty: EasyInstitutions Developing in a Globalized World

"We have come to recognize that the standard of living of one nation is dependent upon the standard of living of another... We have to see to it that there is a pool of international credit available to help countries over temporary difficulties in their balance of payments, so that they will not be forced to take measures destructive of international trade."

— Henry Morgenthau Jr., United States Secretary of the Treasury, address at the closing session of the Bretton Woods Conference, 1944

The economic goals described in the passage led most directly to the establishment of which of the following twentieth-century institutions?

  1. The International Monetary FundAnswer
  2. B
    The League of Nations mandate system
  3. C
    State-sponsored mercantilist trade monopolies
  4. D
    A single global government that eliminated cultural diversity

Answer

The International Monetary Fund
The correct answer is the International Monetary Fund. The stimulus details the establishment of a cooperative financial framework at the 1944 Bretton Woods Conference, specifically describing a pool of international credit to assist countries facing balance-of-payments crises. This is the primary function of the International Monetary Fund (IMF), which was designed to stabilize exchange rates and facilitate international trade.

Step-by-Step Solution

1
Analyze the stimulus context and keywords.
The speech was delivered by the U.S. Secretary of the Treasury at the Bretton Woods Conference in 1944, and it details the creation of an international pool of credit to support nations experiencing balance-of-payments difficulties.
Understanding the core focus of the historical source is necessary to identify the institution it describes.
2
Relate the described function to late-twentieth-century global institutions.
The primary role of lending short-term capital to countries facing balance-of-payments crises is the central mandate of the International Monetary Fund (IMF), established at Bretton Woods.
Matching the institutional function in the text with historical knowledge of post-WWII economic organizations.

Key Concept

The role of international economic institutions (like the IMF) in fostering global integration and economic stability after World War II.
Rate this question

Topics

Institutions Developing in a Globalized World

More questions from this topic