Final answer:
An economic union indeed involves a high level of liberalization in preferential trade agreements. The EU is a primary example of an economic union where member countries coordinate their fiscal and monetary policies in addition to adopting a common external trade policy.
Step-by-step explanation:
True, an economic union involves a high level of liberalization in preferential trade agreements. This form of integration encompasses not just the elimination of tariffs and quotas among member states, allowing for the free movement of goods and services, but also extends to a common external trade policy, and the coordination of fiscal and monetary policies.
One of the most notable examples of an economic union is the European Union (EU), which has evolved from a free trade association to a common market, and ultimately into a comprehensive economic union with shared economic institutions and policies. In such a union, member countries often forgo certain aspects of political autonomy, such as control over their monetary policies and external trade agreements, to enable a harmonized economic environment aimed at fostering stability and growth among the member nations.