Question

he countries of Mimbo, Juwan, and Ninot agreed to remove all barriers to the trade ofgoods and services among each other. However, the three countries agreed that eachwould be allowed to determine its own trade policies with regard to nonmembers. Theeconomic integration among these three countries is a(n)A) economic union. B) free trade area. C) customs union. D) common market

Answer 1

Answer: Free trade area

Explanation: Free trade area is a trade Bloc where the countries involved have signed a free trade agreement such that there are no quotas, import tariffs or embargo on goods traded between the countries involved.

The aim of free trade is to increase the amount of international trade among the countries involved and for the countries to enjoy comparative advantage. In a free trade, every country can set its own trade policy for non-members.Examples of free trade areas include European Free Trade Association (EFTA) which consists of Iceland, Norway, Switzerland and Liechtenstein.