Chap029

Chap029 - Chapter 29 - The International Monetary System:...

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Chapter 29 - The International Monetary System: Past Chapter 29 The International Monetary System: Past Multiple Choice Questions 1. In the economic and monetary union in Europe (EMU), the member countries a. Tie their currencies to the U.S. dollar B . Use a common currency (the euro) c. Tie their currencies to the SDR d. Have completely flexible exchange rates with each other 2. Under the international monetary system as it actually operated between 1947 and 1971, the emergence of seemingly chronic deficits and surpluses in various countries' balance- of- payments positions (i.e., deficits and surpluses which did not seem to get eliminated) was called a. The liquidity problem b. The confidence problem C . The adjustment problem d. The IMF problem 3. The event that essentially led to the end of the Bretton Woods system was a. The devaluation of the British pound in 1967 b. The introduction of the euro in 1999 c. The introduction of Special Drawing Rights (SDRs) in 1970 D . The U.S. government's declaration in 1971 that it would no longer buy and sell gold from or to foreign central banks in exchange for dollars 4. Two of the "convergence criteria" pertaining to initial membership in the EMU were that a country's ratio of government debt to GDP must be __________ and that a country's ratio of government budget deficit to GDP must __________. A . 60 percent or less; 3 percent or less b. 60 percent or less; 60 percent or less c. 3 percent or less; also be 3 percent or less d. 3 percent or less; 60 percent or less 29-1
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Chapter 29 - The International Monetary System: Past 5. In the Williamson "target zone" plan, the major industrialized countries would negotiate mutually consistent __________ target exchange rates, and there would be __________ deviation permitted from these target rates. a. Nominal effective; some
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This note was uploaded on 11/27/2009 for the course ECON 421 taught by Professor Macphee,c during the Spring '08 term at UNL.

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Chap029 - Chapter 29 - The International Monetary System:...

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