Final answer:
A group of countries that have reduced or eliminated trade barriers among themselves is known as a free-trade zone. This arrangement is exemplified by trade agreements like NAFTA and CAFTA, and further developed in the EU with the addition of a common currency and a central bank.
Step-by-step explanation:
A group of countries that have reduced or eliminated trade barriers among themselves is known as a free-trade zone. This concept is well-supported by economists who advocate for policies that decrease barriers to international trade. Notable examples include the North American Free Trade Agreement (NAFTA) and the Central American Free Trade Agreement (CAFTA), which eliminated most trade restrictions between member countries. In addition, the European Union (EU) is a sophisticated example of countries that have not only removed trade barriers but also adopted a common currency and centralized monetary policy through the European Central Bank. Among the options provided: 'Free-trade zone' is the correct term that represents a situation where countries have agreed to eliminate or reduce trade tariffs, quotas, and other barriers among each other. 'Embargo zone' implies a restriction on trade, 'Free-travel zone' is not directly related to trade but rather the movement of people, and 'Mutual trade area' is not a commonly used term in this context. Therefore, the correct answer is a. Free-trade zone.