Which of the following is NOT a benefit of adopting the euro?
A) Reducing currency conversion costs
B) Limiting the flexibility in fiscal policy
C) Facilitating direct price comparison
D) Imposing monetary discipline on governments

Question

Quizplus · Accepted Answer

Limiting the flexibility in fiscal policy is not a benefit of adopting the euro. In fact, it can be seen as a drawback for countries that want to stimulate their own economy through fiscal policy measures but are limited by the constraints of the common currency. The other options, reducing currency conversion costs, facilitating direct price comparison, and imposing monetary discipline on governments, are all benefits of adopting the euro. Adopting the euro limits the flexibility in fiscal policy by transferring monetary policy decision-making power to the European Central Bank, which can't tailor its decisions to the specific needs of individual countries within the eurozone. The other options are benefits of adopting the euro, including reducing currency conversion costs, facilitating direct price comparison, and imposing monetary discipline on governments by limiting deficit spending.

Which of the Following Is NOT a Benefit of Adopting