Question

What problem is a free trade agreement most likely to cause for an American business? A) Increased access to international markets. B) Reduced competition with foreign businesses. C) Tariff reductions on imported goods. D) Competition from foreign businesses in the domestic market.

Answer 1

D) Competition from foreign businesses in the domestic market.

A free trade agreement typically reduces trade barriers and allows foreign businesses greater access to the domestic market. While it can provide American businesses with increased access to international markets (Option A), it also exposes them to increased competition from foreign businesses in their own market, which can be a challenge.