Larger economic benefits from a currency union occur when:

Question

Quizplus · Accepted Answer

Market integration, such as the free movement of goods, services, and capital in a currency union, can lead to efficiency gains and larger economic benefits. This is because it promotes specialization and increased trade within the union, leading to a larger market size and greater competitiveness. Independence of the central bank is also important for the proper functioning of a currency union, but it is not the only factor that determines the economic benefits. Competition and currency pegs are not necessarily associated with larger economic benefits from a currency union.

Larger Economic Benefits from a Currency Union Occur When