Describe the history and consequent deepening as the European Union developed
Which treaties created which level of economic integration? Do countries have the ability to participate in some levels of integration and not others? Give specific examples.
The Treaty of Rome created the basics for a free trade area as well as a political infrastructure for noneconomic integration.
The Single European Act created a common market among the participants and dealt with an outstanding customs union issues.
The Treaty on European Union (or Maastricht Treaty) brought the participating countries into economic union.
Some countries (such as Norway and Switzerland) participate in the common market but are not members of the EU. Only 12 countries currently participate in the treaty on European Union. For example, the UK, Denmark, and Sweden will never be required to use the euro.
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The outcome of first-degree price discrimination is:
A) Pareto efficient with equity. B) Pareto efficient with inequity. C) Pareto inefficient with inequity. D) Pareto inefficient but is equitable.
The Treasury yield curve will be downward sloping when
A) investors expect future short-term interest rates to be significantly lower than current short-term interest rates. B) investors expect future short-term interest rates to be significantly higher than current short-term interest rates. C) short-term interest rates are significantly lower than long-term interest rates. D) short-term interest rates are equal to long-term interest rates.
The principle of vertical equity is satisfied when _____
a. individuals with a greater ability to pay have higher taxes than individuals with a lower ability to pay b. individuals receiving higher benefits from a government program pay higher taxes than those receiving lower benefits c. taxes increase as family size increases d. taxes on higher income individuals are more efficient than the taxes on lower income individuals
In Figure 9.5, a movement from Point A to Point C would result from
A. An improvement in expectations for future sales. B. A decrease in the interest rates. C. A decrease in disposable income. D. An improvement in technology.