Are the statements below true or false? (0.5 mark for each) Explain the reasons for your answers (1.5 marks for each)

(A) Country which decides to join a Monetary Union expects a decreased ability to stabilize its output around the full employment level and keep inflation low compared with its initial ability under flexible exchange rates.(2 marks)

(B) Suppose that the United States is on a bimetallic standard at $35 to one ounce of gold and $3 for one ounce of silver. If new silver mines open and flood the market with silver, the two metals will circulate as before in the US since citizens could exchange their gold currency for silver currency at any time. (2 marks)