According to the Theory of Optimum Currency Areas

question 31

Multiple Choice

According to the theory of optimum currency areas,

• A)the relevant criterion for identifying and designing a common currency zone is the degree of factor (i.e.,capital and labor)mobility within the zone.
• B)exchange rates should reflect the degree to which workers are willing to move to get a better job.
• C)exchange rates are determined by portfolio managers seeking the highest return.
• D)none of the options

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Definitions:

European

Pertaining to a person from, or associated with, the continent of Europe.

American

denotes relating to the United States, its people, culture, or characteristics.

Japanese

Relating to Japan, its people, language, or culture.

Self-report Inventory

A type of psychological test in which a person fills out a survey or questionnaire with questions about themselves, used to assess mental health.