Social Studies Praxis Practice Test

What was the major purpose of the North American Free Trade Agreement (NAFTA)?

1. A. To protect labor unions in the United States, Canada, and Mexico

2. B. To increase energy production in the United States, Canada, and Mexico

3. C. To reduce tariffs and other trade barriers among the United States, Canada, and Mexico

4. D. To increase trade between North America and the European Union

The correct answer is: C. To reduce tariffs and other trade barriers among the United States, Canada, and Mexico

The major purpose of the North American Free Trade Agreement (NAFTA) was to reduce tariffs and other trade barriers among the United States, Canada, and Mexico. This agreement was designed to create a trilateral trade bloc in North America, allowing for the free flow of goods and services across borders without the imposition of tariffs, which can increase costs and hinder trade. By eliminating these trade barriers, NAFTA aimed to enhance economic cooperation and promote trade among the three nations, ultimately leading to economic growth and increased competitiveness in the global marketplace. The focus on reducing tariffs aligns with the broader goals of free trade agreements, which seek to lower costs for consumers and businesses and create a more integrated economic region. This purpose is a key reason why NAFTA was significant in reshaping trade relationships in North America and has had lasting impacts on economic policies and practices in the involved countries.