Question

What is free trade?

Hint:

Free trade boosts economic cooperation among nations and helps consumers by providing access to a wider variety of goods at competitive prices.

Answer 1

Free trade refers to the unrestricted exchange of goods and services between countries without the imposition of tariffs, quotas, or other trade barriers. It allows countries to specialize in the production of goods where they have a comparative advantage, leading to greater efficiency and global economic growth.
Step 1: Meaning of Free Trade.
Free trade means international trade that is not hindered by government-imposed restrictions such as tariffs, subsidies, or import/export quotas.
Step 2: Purpose of Free Trade.
The purpose of free trade is to encourage open competition among nations, improve consumer choices, and promote the efficient allocation of resources.
Step 3: Advantages.
Free trade promotes economic growth, lowers prices for consumers, and encourages innovation through global competition.
Step 4: Example.
Agreements like the World Trade Organization (WTO) and regional trade blocs such as ASEAN promote free trade by reducing restrictions on cross-border commerce.