Deck 14: The European Union: Many Markets Into One

Question 1

According to the principle of subsidiarity,in which of the following areas should the authority for making decisions be taken from national governments and given to the EU?

A)Pollution of a trans-national waterway
B)Limits on the hours retails stores are allowed to be open
C)Highway traffic laws
D)Recycling requirements on packaging
E)All of the above.

Answer 1

A

Question 2

Before the creation of the European Economic Community,there was the

A)European Economic Union.
B)European Coal and Steel Community.
C)European Union.
D)European Free Trade Area.
E)Single European Community.

Answer 2

B

Question 3

The principle of subsidiarity is a way to

A)divide power between local governments and unions.
B)provide support for industries in decline.
C)provide support for industries under pressure from foreign competition.
D)divide power between national governments and the EU.
E)divide EU tax money among the member countries.

Answer 3

D

Question 4

The primary legislative branch of the European Union is called the

A)European Commission.
B)European Parliament.
C)European Court of Justice.
D)European Council of Ministers.
E)Council of the European Union.

Question 5

Members of which European Union institution are popularly elected?

Question 6

Subsidiarity requires nations to give up some of their national sovereignty.

Question 7

Which of the following nations DOES use the euro and participates in the Treaty on European Union?

A)Sweden
B)Denmark
C)Portugal
D)The United Kingdom
E)Norway

Question 8

A narrow target zone exchange rate band (such as the EEC had until 1992)is most similar to

A)a flexible exchange rate system.
B)a single currency.
C)a fixed exchange rate system.
D)an undervalued currency.
E)a managed floating exchange rate.

Question 9

Which of the following is NOT part of the European Union?

A)Luxembourg
B)Austria
C)Portugal
D)Greece
E)Switzerland

Question 10

The European Union is the oldest,largest,and most ambitious integration agreement in the world today.

Question 11

The roots of the European Union are in agreements within the coal and steel industries.

Question 12

What three sources of revenue finance the EU budget?

Question 13

What are the two largest expenditure categories in the EU budget?

Question 14

All the countries of the EU participate in the Schengen Agreement.

Question 15

The founding document of the European Economic Community,and the document that continues to provide the basis for the European Union is the

A)Treaty of Brussels.
B)Delors Report.
C)Treaty of Rome.
D)Single European Treaty.
E)Maastricht Treaty.

Question 16

Most cohesion funds in the EU budget go to the wealthier EU member nations.

Question 17

A major reason for creating the European Monetary System was to

A)create a single currency.
B)unify banking laws and permit cross-border investment.
C)avoid competitive devaluations.
D)reduce the costs of changing currencies.
E)eliminate the need for central banks.

Question 18

Which nation is NOT one of the current members of the European Union?

A)Greece
B)Germany
C)Sweden
D)Norway

Question 19

The single most important factor in the 1992 crisis of the EMS was

A)ratification of the Single European Act.
B)the near failure of the Maastricht Treaty.
C)the fall in unemployment rates throughout the EEC.
D)German reunification efforts.
E)the outbreak of war in the former Yugoslavia.

Question 20

Which of the following treaties/agreements would be associated with creating a free trade area for the European Union?

A)Treaty of Rome
B)Single Europe Treaty
C)Delors Agreement
D)Treaty on European Union
E)Schengen Agreement

Question 21

Adopting the Single European Act had broad popular support;the Treaty on European Union was more controversial.

Question 22

The Single European Act was expected to create economic benefits by reducing the costs and risks of currency market transactions.

Question 23

Other nations had tried economic union in the past,and since adopting a common currency had shown economic benefits for them,the nations of Europe decided to try it too.

Question 24

Which agreement removes customs and passport controls at the common borders of many EU countries?

Question 25

As Europe explored monetary union,evidence to date suggests that increased variability in exchange rates

A)reduces foreign trade and investment.
B)increases foreign trade and investment.
C)does not seem to have an impact on foreign trade and investment.
D)hurts foreign investment but not trade.
E)hurts foreign trade but not investment.

Question 26

The "Four Freedoms" are an important goal of the

A)Treaty of Rome.
B)Single European Act.
C)European Monetary System.
D)Maastricht Treaty.
E)European Free Trade Area.

Question 27

The "Four Freedoms" do NOT include the right to

A)vote in local elections.
B)migrate within the EU.
C)write insurance policies throughout the EU.
D)open bank accounts anywhere in the EU.
E)move goods from one country to another inside the EU.

Question 28

One drawback to a single currency is that

A)the exchange rate is more volatile.
B)bond markets are larger and therefore harder to control.
C)exporters and importers have fewer choices about how they will receive and make payments.
D)individual nations cannot use monetary policy to stabilize the economy.
E)foreign currency is more expensive.

Question 29

Which EU institution has played a significant role is responding to the economic crisis that began in 2007?

Question 30

Describe the history and consequent deepening as the European Union developed.Which treaties created which level of economic integration? Do countries have the ability to participate in some levels of integration and not others? Give specific examples.

Question 31

The European Union became an economic union with the implementation of which treaty?

A)Treaty of Rome
B)Single Europe Treaty
C)Delor's Agreement
D)Treaty on European Union
E)Schengen Agreement

Question 32

The first and biggest problem the EU faces in its expansion to the east is

A)the reform of its agricultural subsidy programs.
B)the lack of democracy in the countries that are most likely to become members.
C)the unwillingness of the new members to adopt EU rules.
D)the lack of market economies in the countries that are most likely to become members.
E)the unwillingness of citizens in the new member countries to migrate to higher income countries.

Question 33

The single currency project in the EU will be most successful if European labor is relatively

A)immobile.
B)immobile and business cycles are not synchronized.
C)mobile and business cycles are synchronized.
D)mobile and business cycles are not synchronized.
E)mobile.

Question 34

When did the European Union become a common market?

Question 35

With the full implementation of the Single European Act,the EU became a

A)common market.
B)free trade area.
C)customs union.
D)economic union.
E)None of the above.

Question 36

Which of the following is the treaty that took the participating countries from a free trade area to a common market?

A)The Treaty of Rome
B)The Maastricht Treaty
C)Single European Act
D)Treaty on European Union

Question 37

Each of the 15 members of the European Union that joined before May 2004 use the euro as their currency.

Question 38

The currency crisis of 1992 caused France and a number of other countries to choose between

A)a single currency for the EU and keeping their own currency.
B)doing the right thing for their domestic economy and defending the exchange rate.
C)lowering interest rates and reducing unemployment.
D)competitive devaluations and falling unemployment.
E)the Maastricht Treaty and the Single European Act.

Question 39

After implementation of the Single European Act,value added taxes in the EU were

A)completely harmonized.
B)unchanged.
C)partially harmonized with minimum and maximum permissible values set by the EU.
D)eliminated except on a few items in each country.
E)cut in half in order to increase the role of corporate taxes.

Question 40

The Maastricht Treaty eliminated passport controls at borders with the European Union.

Question 41

There is no possibility of further widening of the European Union.

Question 42

Which of the following is NOT one of the major problems with expanding the EU?

A)Expansion has become a more difficult task because of the unwillingness of the eastern and central European countries to change.
B)The programs that target EU expenditures could be stretched thin by the addition of countries with much lower incomes.
C)The governance structure of the EU had to be changed to avoid becoming unwieldy and ineffective.
D)The EU may be faced with an unstable eastern border with huge worker migratory flows if the transition economies fail.
E)Most central and eastern European countries have large agricultural sectors and extending subsidies to these countries would entail an enormous flow of funds given the Common Agricultural Policy.

Question 43

What challenges does the European Union face in the short,medium,and long run?

Question 44

Emigration is when people leave a country because of supply push factors.

Question 45

According to your text,what is the major long-run issue facing the European Union?

Question 46

The fact that 10 additional nations joined the European Union in May 2004 is an example of deepening.

Question 47

Describe the criteria for membership in the European Union.Given the criteria,what are some of the major challenges with expanding the EU eastward? What are the potential problems of Turkey joining the EU?

Question 48

As populations age,public spending tends to increase.

Question 49

The European Union membership criteria includes all of the following except

A)the country must participate in free trade with all of its goods and services.
B)the country must follow market-based economics.
C)the country must formally adopt the EU-wide rules such as technical standards,environmental inspections,banking supervision,etc.
D)the country must be a stable functioning democracy.
E)None of the above.