Which of the following is a drawback of adopting the euro?
A)Loss of control over national monetary policy
B)Increase in the cost of capital
C)Reduction in the liquidity of capital markets
D)Reduction of price differentials within the euro zone
E)Loss of investment options open to both individuals and institutions

Question

Quizplus · Accepted Answer

The drawback of adopting the euro is that national authorities have lost control over monetary policy. The implied loss of national sovereignty to the European Central Bank (ECB) underlies the decision by Great Britain, Denmark, and Sweden to stay out of the euro zone.

Which of the Following Is a Drawback of Adopting the Euro