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Library Research Assignment
Scenario
As the world economy becomes more globalized, it is expected that economic
integration will continue. There are 6 stages of economic integration: (1)
preferential trading agreements, (2) free trade agreements, (3) customs unions,
(4) common market, (5) economic and monetary union, and finally, (6) complete
economic integration. Therefore, the European Union has come a long way,
reaching stage 5 in 1999. It is the major monetary union of the approximately 20
monetary unions in the world today, and it is referred to as the European
Economic Monetary Union, or EMU. The euro has become as important as the U.S.
dollar and is being discussed as the next international currency, either
replacing the U.S. dollar or sharing the position with the U.S. dollar as well
as perhaps an Asian currency, such as the Japanese yen or Chinese yuan. For
example, several countries are buying and selling oil in euros rather than U.S.
dollars, which makes sense, given the majority of the oil transactions involve
countries that use the euro. Other areas of the world are considering monetary
unions, such as Southeast Asia and North America. Many countries’ central banks
hold U.S. dollars for transactions involving oil and other international
transactions, which also helps support the value of the U.S. dollar.
Library Research Assignment
Your firm is expanding into Europe, and your department head has asked you to
put together a report on monetary unions in general, include the following:
Discuss the advantages and disadvantages relative to a nation maintaining
its own individual currency.
Discuss the EMU and the euro in detail, including the following:
its history
the countries involved
its implementation
how it has functioned over the last decade, noting any issues that had to be
overcome
How did the International Monetary Fund (IMF) reassign the special drawing
rights (SDR) as a result of changing from several European currencies to the
euro? Discuss whether the EMU helped or hindered the development of the European
Union. Conclude the report with a brief discussion on the possible advantages and
disadvantages of the amero, a possible common currency for Canada, Mexico, and
the United States, which has come up in the press from time to time. Discuss why
you would favor or be against a common currency for North America