One Drawback to a Single Currency Is That

question 50

Multiple Choice

One drawback to a single currency is that

• A)the exchange rate is more volatile.
• B)bond markets are larger and therefore harder to control.
• C)exporters and importers have fewer choices about how they will receive and make payments.
• D)individual nations cannot use monetary policy to stabilize the economy.

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Definitions:

Tariffs

Tariffs are taxes imposed by a government on imported goods, often used to protect domestic industries from foreign competition.

Domestic Consumers

People or families within a nation who buy products and services for their own consumption.

Domestic Suppliers

Businesses or individuals that produce and provide goods or services within the same country they operate.

Tax Revenue

The funds governments receive as a result of taxation.