Multiple Choice
The theory of optimum currency areas predicts that
A) floating exchange rates are most appropriate for areas closely integrated through international trade and factor movements.
B) fixed exchange rates are most appropriate for areas that are loosely integrated through international trade and factor movements.
C) fixed exchange rates are most appropriate for areas closely integrated through international trade and factor movements.
D) floating exchange rates are most appropriate for all countries in Europe.
E) fixed exchange rates are most appropriate for all countries in Europe.
Correct Answer:
Verified
Correct Answer:
Verified
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