Chapter 22 Multiple-choice questions

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. What does EMU stand for?

European Monetary Union correct incorrect

European Macroeconomic Union correct incorrect

Economic and Macroeconomic Union correct incorrect

Economic and Monetary Union correct incorrect

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. Which of the following is responsible for the single currency?

DG for Economic and Financial Affairs correct incorrect

The European Central Bank correct incorrect

The German Bundesbank correct incorrect

Euro area correct incorrect

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. Which of the following is the most accurate?

The institutional design of EMU has always been symmetrical. correct incorrect

The institutional design of the EMU is now asymmetrical. correct incorrect

Economic union is more developed than monetary union. correct incorrect

Monetary union is more developed than economic union. correct incorrect

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. Which of the following countries was forced to leave the Exchange Rate Mechanism (ERM) on what came to be termed 'black Wednesday'?

France correct incorrect

Germany correct incorrect

Italy correct incorrect

The UK correct incorrect

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. The currency of which country was used as the 'anchor currency' in the ERM?

France correct incorrect

Germany correct incorrect

Italy correct incorrect

The UK correct incorrect

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. Which of the following is not one of the 'convergence criteria' to join EMU?

No excessive budgetary deficits correct incorrect

No excessive public debts correct incorrect

National central bank to be politically independent correct incorrect

Monetary financing compulsory correct incorrect

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. During the period of fluctuation post-Maastricht (1992–4), the ERM bands were increased to what size?

± 2.5% correct incorrect

± 6% correct incorrect

± 15% correct incorrect

± 28% correct incorrect

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. How many countries joined the single currency on 1 January 1999?

6 correct incorrect

8 correct incorrect

11 correct incorrect

12 correct incorrect

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. Which of the following theories of EMU integration highlights the central role of the Commission President and DG for Economic and Financial Affairs?

Economic theory of optimum currency area correct incorrect

Economic theory of central bank credibility correct incorrect

Political theory of neo-functionalism correct incorrect

Political theory of intergovernmentalism correct incorrect

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. In the context of the financial and economic crisis, the Stability and Growth Pact (SGP) was substantially revised. Which of the following was not one of the revisions?

Rules will come into force if countries do not comply with the 3% deficit and/or the 60% debt criteria. correct incorrect

The Commission has a diminished supervisory role. correct incorrect

Qualified majority voting to be used to stop the imposition of sanctions. correct incorrect

Debt is considered as important a consideration as deficit. correct incorrect