Ordering Impacts of Global Monetary System Evolution

The question asks to arrange the impacts of the evolving global monetary system on economies in a sequential order. This requires understanding the typical progression of global economic integration and policy responses.

Step-by-Step Sequence Analysis

1. C. Increased world trade with limited capital flows: This represents an initial phase where countries focus on expanding trade but maintain controls on capital movement, reflecting earlier stages of globalization.

2. A. Protectionism and nationalism: This often emerges as a response to perceived negative consequences of increased trade or financial integration, or during periods of economic stress. It can represent a disruption or a counter-trend in the evolution.

3. D. Expanded open economies: Following or alongside periods of protectionism, there is often a trend towards economic liberalization, reducing trade barriers and opening markets more broadly.

4. E. Industrial economies increasingly open and emerging nations open slowly: This step refines the concept of open economies, acknowledging that the pace of opening differs between developed industrial nations and emerging economies, reflecting a more nuanced integration process.

5. B. Capital flows driving economic development: This signifies a mature stage of integration where capital moves more freely across borders, playing a crucial role in financing and driving economic growth, particularly in developing nations.

Final Arrangement

Based on this logical progression, the correct sequential arrangement is C, A, D, E, B.

Therefore, the correct option is 2. C, A, D, E, B.