A trade deal between Canada, Mexico, and the US

A trade deal between Canada, Mexico, and the US

• A. International Cooperation
• B. Hard Power
• C. Incentive
• D. NAFTA (North American Free Trade Agreement)

Answer: (D)

Trade deals among nations are formal agreements that set rules for how countries will exchange goods and services, often cutting tariffs and standardizing rules. The scenario describes a concrete pact involving Canada, Mexico, and the United States to govern their cross-border trade—that is the hallmark of a trilateral trade agreement. The specific name for that three-country deal is NAFTA, the North American Free Trade Agreement, which provided the binding framework shaping their commerce for years. This is more precise than a broad idea like international cooperation, and it’s not about coercive power (hard power) or merely offering an incentive without a binding agreement. (Note: NAFTA has since been updated and replaced by USMCA, but the three-country trade deal described is NAFTA.)

Trade deals among nations are formal agreements that set rules for how countries will exchange goods and services, often cutting tariffs and standardizing rules. The scenario describes a concrete pact involving Canada, Mexico, and the United States to govern their cross-border trade—that is the hallmark of a trilateral trade agreement. The specific name for that three-country deal is NAFTA, the North American Free Trade Agreement, which provided the binding framework shaping their commerce for years. This is more precise than a broad idea like international cooperation, and it’s not about coercive power (hard power) or merely offering an incentive without a binding agreement. (Note: NAFTA has since been updated and replaced by USMCA, but the three-country trade deal described is NAFTA.)