CFA Level I · CFA Level I Exam · International Trade
Which feature most likely distinguishes an economic and monetary union from a common market?
An economic and monetary union most likely differs from a common market because members adopt a common currency and a common monetary policy. A common external tariff and free movement of labor already exist at earlier stages of integration.
- AMembers adopt a common currency and a common monetary policyCorrect
- BMembers impose a common external tariff
- CMembers allow free movement of labor
Explanation
A common external tariff is present in a customs union, and free labor movement is in a common market. An economic and monetary union goes further by adopting a common currency and unified monetary policy, with some harmonization of economic policy.
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