Final answer:
A free trade area is an agreement between countries to eliminate tariffs among member countries while allowing them to maintain their own trade policies externally.
Step-by-step explanation:
A free trade area involves cooperative agreements between multiple countries to reduce trade barriers but does not require a common external trade policy or the free movement of factors like labor and capital. It essentially means that member countries work together to abolish tariffs amongst themselves, making it easier to buy and sell goods across borders. However, unlike a common market or an economic union, a free trade area allows each country to maintain its own trade policies toward non-member nations.