2562EconomicsMedium
Which of the following is a problem for monetary policy in a currency union?
AThe interest rate may be higher than is appropriate for economic conditions in some countries while it’s lower than is appropriate in some others monetary policy must be one size fits all
BThe inflation-unemployment trade-off is more unstable in a currency union
CAll of these answers describe problems for monetary policy in a currency union
DMoney supply is more difficult to control in a currency union.
Correct answer
A. The interest rate may be higher than is appropriate for economic conditions in some countries while it’s lower than is appropriate in some others monetary policy must be one size fits all
Explanation
The correct answer is The interest rate may be higher than is appropriate for economic conditions in some countries while it’s lower than is appropriate in some others monetary policy must be one size fits all.