Classical Gold Standard 1875-1914 For example, if the dollar is pegged to gold at U.S$30=1 ounce of gold, and the british pound is pegged to gold at e6=l ounce of gold, it must be the case that the exchange rate is determined by the relative gold contents $30=￡6 $5=￡1 McGraw-Hilylrwoin 2-5 Copyright@ 2001 by The McGraw-Hill Companies, Inc. All rightsMcGraw-Hill/Irwin Copyright © 2001 by The McGraw-Hill Companies, Inc. All rights reserved. 2-5 For example, if the dollar is pegged to gold at U.S.$30 = 1 ounce of gold, and the British pound is pegged to gold at £6 = 1 ounce of gold, it must be the case that the exchange rate is determined by the relative gold contents: Classical Gold Standard: 1875-1914 $30 = £6 $5 = £1