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1 | |
The Single European Act committed ____________ governments to a __________ in 1992 |
|
| | A) | European union, single market |
| | B) | Western European, single currency area |
| | C) | European Union, single currency area |
| | D) | Western European, single market |
|
2 | |
All of the following are benefits of the Single Market except that |
|
| | A) | it allows countries to exploit their comparative advantage more fully |
| | B) | firms could more readily exploit economies of scale |
| | C) | it intensified competition |
| | D) | it is easier to book holidays in member countries |
|
3 | |
A monetary union means __________, ____________ and ____________ |
|
| | A) | permanently fixed capital movements, floating exchange rates, a fixed structure of interest rates |
| | B) | permanently fixed exchange rates, free capital movements, a single interest rate |
| | C) | a common currency, a single central bank, common monetary policy |
| | D) | a common currency, floating exchange rates, common monetary policy |
|
4 | |
The Maastricht criteria for entry to the EMU are that applicants should have |
|
| | A) | low inflation |
| | B) | low interest rates |
| | C) | stable nominal exchange rates |
| | D) | budget deficits and government debt under control |
| | E) | all of the above |
|
5 | |
In the EMU a country's competitiveness can change because of __________ |
|
| | A) | interest rate adjustment |
| | B) | central bank intervention in the forex |
| | C) | domestic wage and price adjustment |
| | D) | devaluation |
|
6 | |
The transition of Eastern European economies to market economics involves introducing ________ and ________ |
|
| | A) | the profit motive, deregulation |
| | B) | planning committees, incentives |
| | C) | artificially low prices, controlling demand |
| | D) | planning committees, demand management |
|
7 | |
Economic transition involves high inflation because ____________ and ___________ |
|
| | A) | of high monetary growth, high wages |
| | B) | of high budget deficits, devaluation |
| | C) | of high monetary growth, devaluation |
| | D) | prices surge from an artificially low level to their equilibrium level, the inflation tax is required as a source of government revenue |
|
8 | |
Output fell sharply in the transition economies because |
|
| | A) | banks were unable to function |
| | B) | there was little corporate control |
| | C) | vital infrastructure was missing |
| | D) | all of the above |
|
9 | |
The Maastricht criteria for joining EMU is that a country must have a high growth rate |
|
| | A) | TRUE |
| | B) | FALSE |
|
10 | |
The UK is a member of the EMU |
|
| | A) | TRUE |
| | B) | FALSE |
|
11 | |
Fiscal federalism is when a central government sets taxes and expenditure rules that apply to its constituent states or countries |
|
| | A) | TRUE |
| | B) | FALSE |
|
12 | |
Most transition economies are seeking membership of the EU |
|
| | A) | TRUE |
| | B) | FALSE |
2002 A McGraw-Hill Online Learning Centre