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ARE YOU FINANCIALLY LITERATE? CHAPTERS 1-5
12. Xin-li, a tourist from China, is having a great time in London. She’s seen Buckingham Palace and Piccadilly Square. Today she is shopping for souvenirs to bring back to her friends. Due to a trade dispute over oil exports, the Chinese Yuan has fallen (weakened) against the Euro. Should she be worried about the purchasing power of her Yuan in London? Explain. a. Yes b. No _ ____________________________________________________________________ _ ____________________________________________________________________ _ ____________________________________________________________________ _ ____________________________________________________________________ 13. What is the European Union , under what treaty was it formed, and when? _ ____________________________________________________________________ _ ____________________________________________________________________ _ ____________________________________________________________________ 14. What distinguishes the EU from the Eurozone? _ ____________________________________________________________________ _ ____________________________________________________________________ 15. Which country is a member of the EU, but not a member of the Eurozone? She is exchanging Yuan for Pounds, not Euros. The U.K. is an EU member but not in the Eurozone . FX rates fluctuate relative to one another so the Yuan/Euro rate change should not impact her currency value . The European Union (EU) is an economic and political union formed by the Maastricht Treaty of 28 member states that are primarily located in Europe . It was formed in 1992. The use of euro as currency. The 18 countries within the EU that use the Euro are referred to as the Eurozone . PRODUCT PREVIEW a. Denmark b. Germany
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c. Cyprus d. Ireland e. Netherlands 16. What is the symbol for the Euro? _______ 17. What is legal tender? €
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_ ____________________________________________________________________ _ ____________________________________________________________________ 18. Explain intrinsic value . _ ____________________________________________________________________ _ ____________________________________________________________________ Legal tender is the medium of exchange recognized by the government of a country as national currency. The value of the essence of a thing.
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Assessment
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