Which One of These Benefits of a Single Currency Is

question 5

Multiple Choice

Which one of these benefits of a single currency is NOT correctly explained?

• A) Using a single currency reduces price discrimination because companies will be obliged by law to charge the same prices for their goods in the different countries of the currency union.
• B) None of the benefits of a single currency described in these answers is incorrectly explained.
• C) Using a single currency reduces transaction costs involved in trade between members of a common currency area and the resources that are no longer employed in working on currency transactions can be used more productively to produce other goods and services.
• D) Using a single currency eliminates exchange rate variability for companies trading with other members of the common currency area and so companies may engage in more of this trade, and they can also eliminate the cost of entering into forward foreign exchange contracts with banks.

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Definitions:

Intellectual Capital

The intangible value of a business, specifically human knowledge, relationships, and organizational innovation that gives it a competitive edge.

Valuable Skills

Competencies or abilities considered highly useful or beneficial, especially in a job market context.

Inadequate Management

Inadequate management refers to insufficient or ineffective management practices that fail to meet organizational goals or address workforce needs.

Retain Quality Employees

Strategies and practices aimed at keeping valuable and skilled staff members engaged and committed to an organization.