Chap002 45 - D. maintain its currency at a fixed exchange...

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63. The advent of the euro marks the first time that sovereign countries have voluntarily given up their A. national borders to foster economic integration. B. monetary independence to foster economic integration. C. fiscal policy independence to foster economic integration. D. national debt to foster economic integration. Topic: European Monetary System 64. To pave the way for the European Monetary Union, the member countries of the European Monetary System agreed to achieve a convergence of their economies. Which of the following is NOT a condition of convergence: A. keep the ratio of government budget deficits to GDP below 3 percent. B. keep gross public debts below 60 percent of GDP. C. achieve a high degree of price stability.
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Unformatted text preview: D. maintain its currency at a fixed exchange rate to the ERM. Topic: European Monetary System 65. The European Monetary System (EMS) has the chief objective(s) A. to establish a "zone of monetary stability" in Europe. B. to coordinate exchange rate policies vis-à-vis the non-EMS currencies. C. to pave the way for the eventual European monetary union. D. all of the above Topic: European Monetary System 66. The Exchange Rate Mechanism (ERM) is A. the procedure by which ERM member countries collectively manage their exchange rates. B. based on a "parity-grid" system, which is a system of par values among ERM countries. C. a and b D. none of the above Topic: European Monetary System...
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This note was uploaded on 11/09/2011 for the course FIN IFMG201 taught by Professor Eun during the Spring '11 term at Michigan Flint.

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