Answer to Question #253655 in Management for Ben

Question

Define free trade agreement and its economic benefits and consequences

Answer 1

A free trade agreement is an agreement between nations to reduce or eliminate government tariffs or quotas to imports and exports.

A free trade agreement encourages more investors in a country due to reduced costs of imports and exports resulting from reduced tariffs hence a country realizes an increase in economic growth.

Additionally, a free trade allows consumers acquire more products of better quality at lower costs, hence it creates fairness to all consumers.