Gold standard is the use of gold as the standard of value for the money of a country. A country is on the gold standard when it will redeem any of its money in gold and when it agrees to buy and sell gold at a fixed price. Advantages of following the gold standard are that it checks inflation, restrains government spending, and stabilizes currency exchange rates among countries that use it. The disadvantages are that it prevents necessary adjustments in domestic currency supplies and international exchange rates.