When two countries sign a free trade agreement, they agree to a. reduce import and export barriers b. create new trade quotas c. reduce the volume of trade d. create protectionist policies

ANSWER

A. Reduce import and export barriers

EXPLANATION

A free trade agreement involves cooperation between at least two countries to:

i) reduce trade barriers

ii) reduce import quotas and tariffs but not to create new import quotas

iii) and to increase trade of goods and services with each other.

Therefore the correct answer is A

When two countries sign a free trade agreement, they agree to Reduce import and export barriers.

Option A

Explanation:

Free trade practice is a pact between two countries to allow for import and export of various items so that the trade in both countries can be boosted and the economy can grow. In free trade agreement, a wide range of products and goods can cross the international boundaries without any regulation and government policies that stop the trade, In free trade agreement, there are no quotas and extra tariffs on the products being traded.