Materials exam Flashcards
1973 enlargement
UK, Denmark, Ireland
Stabilisation and Association Agreement
EU and Western Balkan countries
Trade policy is an exclusive competency of the EU?
YES
countries cannot make their own agreements
the substantive backbone of the EU cohesion policy 2014-2020
Europe 2020 Strategy
Lisbon strategy (2000) objective
EU economy will become the most competitive in the world
Open Method of Coordination
EU policy-making process or a regulatory instrument
initiated by the Lisbon European Council in 2000
soft governance in areas falling under the partial or full competence of Member States
instruments: guidelines, evaluations
Why can asymmetric shocks impose costs on member states of monetary union?
they increase mobility and hence labour market costs for countries that are affected by asymmetric shock
Which conceptual argument does NOT speak in favour of coordination of fiscal policies on the EU level?
deficit bias of national fiscal policies
Is rural development an integral part of the Common Agricultural Policy?
yes
What was the key feature of the Common Agricultural Policy in the period 1983/84-1992/92?
Control of Supply of agricultural products based on introduction of a complex system of quotas (limitation on production)
What are the main principles of the EU law?
Direct effect, autonomy, and primacy of the EU law
What is the key characteristic of a “regulation” as one of the main types of the EU secondary legislation?
It is mandatory legal act of the EU which applies directly to all EU member states.
Which two EU policies account for approximately three quarters of all EU budget?
Common Agricultural Policy and Cohesion Policy
Which geographical areas of the EU are entitled to the largest portion of cohesion policy resources from the EU budget?
regions with a GDP per capita under 75% of the EU average
NUTS system - 3 levels of statistical units in a country
eastern and southern countries
What are the main legal sources of the EU competition and state aids policy?
The Treaty (která??) and the Merger Regulation
What do articles 101 and 102 of the Lisbon Treaty (articles 81 and 82 before
Lisbon Treaty) speak about?
About Competition Policy principles.
What is determined by the “shared competency” in accordance with the Lisbon Treaty?
Areas where both the EU and member states are authorised to adopt legally binding acts but where the EU can only act if the member states have not already exercised their authority.
What is the characteristic of the “old approach” to removal of technical barriers in the internal market?
Detailed harmonization
What is the transmission mechanism of monetary policy of the ECB
Procedures used for transmission of centralized decisions of the Eurosystem to decentralized implementation of these decisions through the national central banks (check)
What was characteristic of the so called “hard” period of the European monetary system (EMS)?
German monetary policy leadership and stability of exchange rates in the exchange rate mechanism (ERM)
Monetary policy decision making in the euro area is ____, while monetary policy implementations is____.
Centralized/decentralized.
Which are the two pillars of the Eurosystem’s strategy in monetary policy decision making?
Economic and monetary analysis
Which of the reasons stated below has been preventing development of a true EU energy policy for many years?
Dominant market position of a small number of players and state ownership in the energy sector.
What role did the so called Cardiff process played in EU environmental policy?
The Cardiff process established the concept of environmental mainstreaming by including environmental aspects in all the areas of EU policies.
What was the common problem of the first two EU emission trading schemes?
Free trade of goods among member states and a common external (customs) tariff towards third countries, free trade of services and free movement of production factors within the internal market.
Which of the statements about the deepening of economic integration in the EU is correct?
Single European Act (1986/1987) is a fundamental treaty, which enabled the start of the Economic and Monetary Union (EMU). (introduction of internal market by 1993)
Which of the following statements best describes the short-term objective of the stability and Growth Pact?
The short term objective of the Stability and Growth Pact is fast and efficient elimination of excessive deficit in member states where the deficit exceeds 3 % of GDP.
What is the maximum amount of sanctions stipulated by the Excessive Deficit Procedure?
0.5 % of GDP of the member state, which breaks the rules.
Common (internal) market is a stage of economic integration characterized by:
Free trade of goods among member states and a common external (customs) tariff towards third countries, free trade of services and free movement of production factors within the internal market.
According to Andre Sapir view (2004), the process of EU convergence towards the US (expressed in capita GDP terms) ended in the 1970s due to the following reason:
The development model applied by the EU member states in the previous decades has proved to be obsolete.
What do you understand under the term Open Method of Coordination?
It is a policy instrument that was largely used for implementation of the Lisbon Strategy.
What is the European Semester?
An annual cycle of coordination of fiscal and economic policies between EU member states that includes regular reporting and definition of member states ‘medium term goals, monitoring implementations of these goals and giving recommendations by EU institutions.
The excessive deficit procedure is
a procedure of monitoring violation of the short term objective of the stability and growth pact and gradual application of recommendations and sanctions against the member state, that breaks this rules.
When is an EU member state considered to have excessive deficit in the
Excessive deficit procedure (EDP)?
When budget deficit is larger than 3% GDP and the member state is not facing exceptional circumstances.
In WTO negotiations, EU member states are represented:
By the EU trade commissioner. (By commission!)
What is TRUE about the EU trade flows?
When intra-EU trade flows (among EU member states) are included around 2/3 of EU trade is within European countries and only 1/3 with non- European countries.
Who is the main trading partner of individual EU member states?
Other EU member states
What is NOT the subject of Article 101 of the Lisbon Treaty
Strengthening of the competition among market players
since it’s about practices harming competition
Which of the following roles does the EU competition policy NOT play?
c. Advisory role
How does the Eurosystem influence EONIA?
By defining the floor, the ceiling and the mid value of the interest rate corridor within which EONIA is freely determined in the market.
What is the economic rationale behind the introduction of the fiscal Maastricht criteria (budget deficit and public debt) for admission into the economic and monetary union (EMU)?
High budget deficits and uncontrollable growth of public debt limit government’s access to financial markets, which may lead to monetization of public debt by the central bank and inflation.
What is the economic rationale for EU involvement in public finance?
d. Lack of fiscal discipline in national public finance
Which of the changed states below is the consequence of the working of automatic fiscal stabilizers?
A fall in Value Added Tax collections due to lower purchasing power during an economic crisis.
What are the two main approaches to the process to European Integration?
Federalism and intergovernmental approach.
Which of the statements about economic integration is correct?
In general, economic integration is defined as an agreement among countries to reduce and ultimately remove various economic and political restraints to mutual economic cooperation
The most frequently used indicators for measuring competitiveness of states includes:
Real effective exchange rate, real growth of per capita income, and indexes based on various variables
Which of the statements about the long term dynamic growth effect of economic integration is correct?
The growth effect operates by changing the rate at which new factors of production – mainly physical, human and technological capital – accumulated. Additionally it also operates through faster international diffusion of knowledge/technology.
Which of the factors stated below was an obstacle to the development of
common EU energy policy?
Dominant market position of national energy companies.
What is the key characteristic of a “directive” as one of the main types of the EU secondary legislation?
It is a mandatory legal act of the EU that only sets out the results to be achieved. EU member states can then decide how to transpose this legal act into national legislation.
What is NOT the element of “abusive behavior” under the Article 102 of the Lisbon Treaty (Article 82 pre-Lisbon)?
a. Agreeing on fair purchase prices
is about abuse of a dominant position
What is the meaning of fiscal transfers criterion as one of the optimum currency area criteria?
Fiscal transfers between countries can be used to soften the impact of asymmetric shocks by having countries in an expansion phase pay transfers to countries in a recession phase.
The main cost of a monetary union is:
Loss of monetary policy autonomy and national exchange rate instrument.
What is the meaning of the term “green direct payments” under the Common Agriculture Policy with in period of the 2014 – 2020 multi annual financial frameworks?
EU member states will allocate at least 30 percent of their respective direct payments for achieving environmentally friendly objectives in the area of agriculture
What proportion of EU budget funds is allocated for the Common Agriculture Policy with in period of the 2014 – 2020 multi annual financial frameworks?
Around 40 %
What is true of EU policies development?
Maintain fixed exchange rates and lead independent monetary policies, if capital is fully mobile.
Which of the following areas is NOT a priority for the European regional development financing in the 2014-2020 medium term financial framework?
e. Communal infrastructure, such as water supply, waste water treatment and similar
What characteristics of the “new approach” to removal of technical barriers in the internal market?
In the non-harmonized sectors mutual recognition principle applies whereas in harmonized sectors the EU determines essential requirements insuring safety, health and environmental protection. Some products are also subject to detailed harmonization of technical standards.
One of the important benefits of a monetary union is:
Reduction of exchange rate risk
The main purpose of the preventive arm of the Stability and Growth Pact is to?
Ensure free functioning of automatic fiscal stabilizers up to the allowed budget deficit ceiling (3 % of GDP) through a balanced budget in the medium run
What is the average estimate of size of automatic fiscal stabilizers in EU member states?
1% drop in GDP on average leads to a worsening budget balance (deficit or surplus) of 0,5 % of GDP
Economic union is a stage of economic integration characterised by:
Free trade of goods, services, capital and labour as well as harmonization of all economics policies
Which of the following problems was not a consequence of implementation of the common agriculture policy?
Insufficient food supply
What is true of “agglomeration” and “dispersion” forces that are behind the economic logic of emergence of regional development differences?
Agglomeration forces encourage concentration of economic activity in a particular area, while dispersion forces have exactly the opposite effect.
The so called impossible Trinity tells us that countries cannot simultaneously:
have fixed exchange rate, free capital flow, and independent monetary policy
Which of the following statement is correct:
The European Commission has a mandate to implement the EU Competition policy
What is the main purpose of the EU Cohesion policy?
To reduce differences in the level of development between different geographical areas of the EU
What is typical of the use of voluntary agreement for achieving environmental policy goals?
The main motivation behind the use of voluntary agreement to achieve environmental policy goals is to establish a good reputation for companies that use these instruments
Which four EU member states had been the largest beneficences of the EU cohesion funds in the period before the 2004-EU enlargement (these member states have also been called the “cohesion four”)?
Greece, Ireland, Portugal and Spain
What are the priorities of the Cohesion fund financing in the 2014-2020 medium-term financial framework?
Transportation and large environmental infrastructure projects
How did the mechanism of price subsidies, used as the main instrument of the Common agriculture policy in the early years of its implementation in the 1960s?
Through fixing the lowest (minimum) prices of different types of agricultural products with the help of variable import levies tied to price fluctuations in the market for agricultural products.
What is the number of Eurozone countries since 1 January, 2015?
19 countries
What is the primary objective of monetary policy of the Euro system?
Price stability
What are the main “sources” of the EU legal system (community law)?
Treaties (primary law), EU laws (secondary law) and decisions of the European Court of Justice
A key component of economic analysis, which represents one of the two pillars of the Euro system’s strategy in monetary policy decision making is:
Future output growth forecast
Which of the statements below about the removal of tax barriers in the EU correct?
Tax base is harmonized across the EU in case of the value added tax
What is determined by the “exclusive competency” in accordance with the Lisbon Treaty”?
Areas where only EU is authorized to adopt legally binding acts whereas the role of the member states is limited to implementing these acts.
Which countries are eligible to get funding from the Instrument for Pre-accession Assistance under the 2014-2020 medium-term financial framework?
Western Balkan (without Croatia IPA I), Turkey. NO ICELAND! For IPA II
Trade relations between EU and Western Balkan countries are____:
Stabilization and Association agreements which ___other things___the gradual establishment of two-way free trade.
The six (deriving force of European integration after the post war time)
Belgium, Luxembourg, Netherlands, Italy, France, Germany.
What is the meaning of fiscal transfers criterion as one of the optimum currency area criteria?
Fiscal transfers between countries can be used to soften the impact of asymmetric shocs by having countries in an expansion phase pay transfers to countries in a recession phase.
What is determined by the “exclusive competence” in accordance with the Lisbon Treaty?
Areas where only the EU is authorized to adopt legally binding acts whereas the role of member states is to limited to implementing these acts.
What is characteristic of the “old approach” to removal of technical barriers in the internal market?
Detailed harmonization in all sectors.
Direct effect as a principle of EU law means that:
EU law must be enforced by member states national courts.
Grafik
Due to discriminatory liberalisation Home importers divert all their import demand…
Economic union is a stage of economic integration, characterized by:
Free trade of goods, services, capital and labor and harmonization of all economic policies.
The Excessive deficit procedure is:
A procedure of monitoring violations in the corrective part of the Stability and Growth Pact and gradual application of recommendations and sanctions against the member state that breaks these rules.
What is true about the implementation of the Stability and Growth Pact during the COVID-19 crises?
A general escape clause has been activated, allowing for an orderly temporary deviation from the normal preventive and corrective requirements of the Pact.
Which statement about the Single Rulebook as a part of the EU banking union is incorrect?
The Single Rulebook determines which banks are direcly supervised by the ECB and which remain under the supervision of national supervisory authorities.
