Custom unions or a common market does not create a free trade area as compared to NAFTA due to:
A)no common external tariffs.
B)decreased production costs.
C)reduced competition.
D)ease of exporting commodities.
E)creation of a continental demand.

Question

Quizplus · Accepted Answer

A free trade area requires a common external tariff where all member countries have the same tariff rates on goods imported from non-member countries. Custom unions or common markets may have lower trade barriers and increased trade between member countries, but without a common external tariff, it cannot be considered a free trade area.

Custom Unions or a Common Market Does Not Create a Free