A small country has applied for membership in an economic union.Before membership is granted, the ruling body of the union requires that the applicant state reduce its budget deficit to a specific percentage of GDP.This type of arrangement could be classified as:
A)structural reform.
B)microfinance.
C)conditionality.
D)neoliberalism.
E)export-oriented adjustment.

Question

Quizplus · Accepted Answer

This arrangement is an example of conditionality, which refers to the conditions placed on a country by external organizations, such as an economic union, in exchange for financial assistance or other benefits. In this case, the country must reduce its budget deficit as a condition for membership in the economic union.

A Small Country Has Applied for Membership in an Economic