Why is greater price transparency beneficial in a monetary union?

Greater price transparency within a monetary union is beneficial primarily because it encourages price competition. In a monetary union, multiple countries share a common currency, which facilitates easier comparison of prices across borders. This transparency allows consumers to see and compare prices of similar goods and services more easily, leading to increased competition among producers and retailers. As a result, businesses are incentivized to lower their prices or improve their offerings to attract consumers, ultimately benefiting the overall economy by promoting efficiency and consumer welfare.

The other options do not align with the concept of monetary unions. For example, eliminating the need for imports would contradict the principles of trade and economic interdependence fostered within a monetary union. Preventing countries from trading undermines the very purpose of a unified currency, which is to enhance trade and economic cooperation. Lastly, increasing the number of currencies used runs counter to the idea of a monetary union itself, which aims to streamline transactions and financial interactions by having a single currency. Thus, encouraging price competition is the key benefit resulting from greater price transparency in a monetary union.