Denmark is not a member of the Eurozone but is a member of the ERM. What are the advantages to Denmark of NOT being a member of the Eurozone?
A) There are none. Denmark stubbornly wants to have its own currency (the krone).
B) The Danish central bank loses its monetary autonomy by not joining the Eurozone.
C) There are not very many transactions between Denmark and Eurozone countries, so transaction gains from membership in the Eurozone would be small for Denmark.
D) The ERM allows much more exchange rate flexibility (+/- 15%) than the Eurozone.
Ans: D) The ERM allows much more exchange rate flexibility (+/- 15%) than the Eurozone.
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A) reduce the quality of health care while raising the costs. B) reduce the cost of health care. C) increase the quality of health care while decreasing the costs. D) increase both the quality of health care and the costs of health care.
Are there impediments to international movement of labor and capital?
A. Yes, but they apply to labor only; capital mobility is almost completely free. B. Yes, although these apply to capital, and not to labor. C. Yes, there are significant (often prohibitive) restrictions on labor and capital mobility. D. No, these have been removed with the passage of recent trade legislation.