Which of the following is not a barrier to trade?

Get ready for the Leaving Certificate Business Test. Prepare with flashcards and multiple choice questions complete with hints and explanations to help you succeed. Ace your exam now!

A free trade agreement is designed to facilitate international trade between countries by reducing or eliminating barriers. This type of agreement typically includes provisions to lower tariffs, abolish quotas, and address other trade restrictions, thereby promoting trade flow and economic cooperation. Countries engage in free trade agreements to enhance their market access and economic growth, making it a tool for encouraging trade rather than restricting it.

In contrast, an embargo involves a complete ban on trade with a specific country, a quota sets a limit on the amount of a particular product that can be imported or exported, and a subsidy provides financial support to local businesses, which can distort competition and affect trade dynamics. These are all considered barriers to trade because they either restrict or manipulate the free exchange of goods and services between nations. Therefore, the correct answer highlights a concept that actively supports trade rather than hindering it.

Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy