Explain what happens with the price level

Reference no: EM131939888

Question: Assume a world consisting of UK and South Africa. Currency of UK is the Pound Sterling and currency of South Africa is the South African Rand. Both countries adhere to the Gold Standard. South Africa is the gold producing country. Explain what happens with the price level in UK and in South Africa and the gold reserves of the central bank of UK and the gold reserves of the central bank of South Africa, if due to technical advances in the mining sector output in the gold industry increases sharply.

Reference no: EM131939888

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