CAIE A-Level Economics 11.6.2 Types of Economic Integration

CAIE A-Level Economics 11.6.2 Types of Economic Integration
Cambridge International AS & A Level Economics 9708 syllabus for exams in 2026, 2027 and 20282026–2028

Practise distinguishing free trade areas, customs unions, monetary unions and full economic unions by their internal barriers, external tariffs, currency and policy commitments.

How this is tested

  • distinguish a customs union from a free trade area by its common external tariff
  • identify a monetary union through a shared currency rather than identical fiscal or tax policy
  • evaluate integration through trade gains, policy independence, administration and diversion costs

Question 27

[Maximum number: 1]

What occurs in a monetary union?

A

Countries have the same currency.

B

Countries use the same fiscal policy.

C

Countries have the same domestic rates of sales tax.

D

The government budget in each country is balanced.