Suppose that Mexico and Canada form a free-trade area and Canada begins importing steel from Mexico rather than from Germany. There occurs:
A. Trade diversion
B. Trade creation
C. Trade destruction
D. Trade exhaustion
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Suppose that Mexico and Canada form a free-trade area. Mexicans then decrease auto manufacturing and increase imports of autos form Canada,whiletheCanadiansdecreasecomputerproductionandimportmorecomputersfromMexico.Thisisanexampleof:
A. Trade diversion
B. Trade creation
C. Trade destruction
D. Trade exhaustion
IftheUnitedStatesandCanadaabolishalltariffsoneachother'sgoodsandimplementacommontariffongoodsimportedfromother countries,thereoccursa(an):
A. Free-trade area
B. Customs union
Common market
D. Economic union
Suppose that the United Kingdom and Italy abolish all traiffs on each other's goods and all restrictions on movements of factors of prodoction between them. They also implement a common protectionist policy toward other countries. This is an example of a (an):
A. Free-trade area
B. Customs union
Common market
D. Economic union
The North American Free Trade Agreement was excepted to benefit____themost.
A. Canada
B. Mexcio
C. Greenland
D. United States