Free trade is one in which

A. each member operates its own barriers against non-members
B. factors of production are mobile
C. members adopt a common external tariff against non-members
D. members adopt common fiscal and economic policies

Correct Answer:

Option B – factors of production are mobile

Explanation

Free trade is a trade policy where goods and services can be bought and sold across international borders with little or no government tariffs, quotas, subsidies.