Question

Choose the correct option to fill the blank.
The act of opening up economies for trading is known as _______.

• A. Balanced trade
• B. Unilateral trade
• C. Free trade
• D. Bilateral trade

Hint:

When studying global trade, focus on the role of free trade agreements in removing barriers and promoting international exchange of goods and services.

Answer 1

The Correct Option is C

The act of opening up economies for trading is known as free trade. Free trade refers to the removal of trade barriers such as tariffs, quotas, and regulations that hinder the exchange of goods and services between countries. In a free trade system, economies are encouraged to specialize in producing goods where they have a comparative advantage, thus promoting efficiency and increasing global wealth. - Balanced trade (A): Refers to a situation where imports and exports are equal, which is not specifically related to the concept of opening up economies for trading.
- Unilateral trade (B): Refers to a country opening its market to imports without necessarily requiring the same from its trade partners. It is not about opening up an economy for reciprocal trade.
- Bilateral trade (D): Refers to trade between two countries, but it is not about the act of opening up economies for general trading.