A group of nations that agrees to drop trade barriers but permits members to maintain independent trade relations with non-group nations,is called

Question

Quizplus · Accepted Answer

A free-trade area is a group of nations that agrees to eliminate trade barriers among themselves, but they are allowed to maintain their own trade relations with non-group countries. This means that members of a free-trade area can negotiate their own trade policies with non-members. A customs union, on the other hand, not only eliminates internal trade barriers but also adopts a common external trade policy towards non-members. A common market goes further than a free-trade area or a customs union by allowing for the free movement of goods, services, capital, and labor among its members. A monetary union involves the adoption of a common currency and monetary policy by its members.

A Group of Nations That Agrees to Drop Trade Barriers