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.Management Sciences
A. The central bank controls interest rates on long-term bonds issued by the governments of the member countries of the currency union
B. Government of the member countries of the currency union may run large budget deficit and so crowd out private investment
C. government of the member countries of the currency union may run large budget deficits and so impose costs on other countries by pushing up interest rates on the bonds these countries governments issue
D. It is difficult to raise enough tax revenue to pay for the operation of the currency union
Related Mcqs:
- A high degree of real wage flexibility will tend to reduce the cost to a country of joining a currency union because ?
- A. All of the reasons given in these answers are correct B. real wages fall rapidly in a recession and the economy moves quickly back to long run equilibrium so limiting the duration of the recession even when exchange rate adjustment is not possible C. workers will move from a country in which aggregate demand … A high degree of real wage flexibility will tend to reduce the cost to a country of joining a currency union because ?Read More...
- How does the eurozone compare with USA as a possible optimal currency area (OCA) ?
- A. The eurozone has a higher degree of labour mobility than the USA and labour law is much less restrictive in the erozone than in the USA On these measures the eurozone is more likely to be an OCA than is the USA B. The eurozone has a lower degree of labour mobility than the … How does the eurozone compare with USA as a possible optimal currency area (OCA) ?Read More...
- To try to overcome the free rider problem, the members of EMU signed ?
- A. the stability and growth pack B. the European solidarity packs C. the exchange rate mechanism pact D. the responsibility and growth pack...
- Which one of the following is not an argument in support of the UK joining the EMU ?
- A. None of these arguments they are all arguments in support of the UK joining the UMU B. The characteristics of the UK housing market make UK consumers expenditure very sensitive to changes in interest rates C. The UK risks exclusion from the Euroland capital market with damaging consequences with damaging D. The UK needs … Which one of the following is not an argument in support of the UK joining the EMU ?Read More...
- Which of the following could not be described as an asymmetric macroeconomic shock ?
- A. None of these answers All of them are asymmetric macroeconomic shocks B. A sudden and substantial fall in the worldwide demand for French wine C. An epidemic of an animal disease in a country that significantly reduces the country’s agricultural output D. A sudden and substantial rise in prices on the world oil market...
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