Answer:
The type of preferential trade agreement that focuses on the elimination of tariffs and/or quotas is:
B. Free Trade Area
Explanation:
A Free Trade Area (FTA) is a type of trade agreement where member countries agree to eliminate tariffs, quotas, and preferences on most (if not all) goods and services traded between them. The primary focus of an FTA is to reduce barriers to trade between the member countries, allowing goods and services to move more freely across borders.
Here’s a brief overview of the other types mentioned:
- Economic Union (A): This goes beyond a common market by integrating member countries' economies more thoroughly, including adopting common economic policies and sometimes a common currency. An economic union encompasses free trade, a common market, and economic policy harmonization.
- Common Market (C): This type of agreement not only removes tariffs and quotas but also allows for the free movement of labor and capital among member countries. It involves deeper integration than an FTA or customs union.
- Customs Union (D): In addition to eliminating tariffs and quotas between member countries (like an FTA), a customs union adopts a common external tariff on goods coming from outside the union. This means that member countries have a unified trade policy towards non-members.
Conclusion:
A Free Trade Area (FTA) is specifically designed to eliminate tariffs and/or quotas between member countries, making it the correct answer.