Question

The member countries of BERPHO, a regional free trade area wanted to adopt a common currency, the "BERPH." The "BERPH" was modeled after and, in fact, was exactly similar to the euro. Establishment of the "BERPH" requires participating national governments to

Answer 1

The member countries of BERPHO, a regional free trade area wanted to adopt a common currency, the "BERPH." The "BERPH" was modeled after and, in fact, was exactly similar to the euro. Establishment of the "BERPH" requires participating national governments:

- to give up control over monetary policy.

- to have a sound fiscal situation.

- to have a high degree of price stability.

- to be democratic in nature.

- to have stable exchange rates

Step-by-step explanation:

BERPHO is an example of an economic union, where the fourteen member countries reached a level of economic integration, which means having a common currency, comprehensive harmonized tax rates, and a common monetary and fiscal policy.