1. Controls on capital outflows provide government officials a false sense of security that they do not have to reform their financial systems to ameliorate crisis. True or false?

2. Being a member ofa monetary union is more appropriate for countries that utilize fiscal policy frequently to remedy negative output shocks. True or false?

3. Developed countries have serious issues in stabilizing their export revenues due to the recent fluctuations in the commodity prices. True or False?

4. According to the purchasing power theory, changes in relative national price levels determine the changes in exchange rates over the short run. True or False?