Some nations benefit absolutely from abandoning their monetary policy and control of their currency because:
A) their monetary policy permitted high inflation under pressure from political interests that would not be present under a common currency arrangement.
B) they did not have sufficient currency in their own nation to support a higher GDP.
C) they had a strong currency, which hurt their exports.
D) the central bank would keep the money supply under tight control, which is not good for economic expansion and jobs.
Ans: A) their monetary policy permitted high inflation under pressure from political interests that would not be present under a common currency arrangement.
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Suppose an apartment complex converts to a condominium, so that the former renters are now owners of their housing units. Suppose further that a current estimate of the value of the condominium owners' housing services is the same as the rent they previously paid. What happens to GDP as a result of this conversion?
a. GDP necessarily increases. b. GDP necessarily decreases. c. GDP is unaffected because neither the rent nor the estimate of the value owner-occupied housing services is included in GDP. d. GDP is unaffected because previously the rent payments were included in GDP and now the rent payments are replaced in GDP by the estimate of the value of owner occupied housing services.