Which of the following is an advantage of a common currency in Europe?
A) Each country could conduct its own, independent monetary policy.
B) Exchange rate uncertainty within the common currency area would be eliminated.
C) Each country could conduct its own, independent fiscal policy.
D) all of the above
E) none of the above
B
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An important factor that increased international capital flows in the latter part of the 1800s was
A) the creation of the International Monetary Fund. B) the creation of numerous regional trade agreements. C) the rapid rate of East Asian economic growth. D) technological innovations. E) the creation of the World Bank.
Refer to the figure above. This country has comparative advantage in
A) X. B) Y. C) both X and Y. D) Can't tell without more information.
Which of the following was the main reason for increased counterparty risk in the shadow banking system prior to the financial crisis of 2007-2009?
A) increased leverage B) government insuring money market deposits C) many firms borrowing long term for short-term investments D) trading of derivatives on exchanges
What is the present value of $1 that will be paid to you in 6 years if the interest rate is 10%? Work it out to the nearest tenth of a cent.
What will be an ideal response?