What is meant by "trade bloc"?

A "trade bloc" refers to a group of countries that have come together to reduce or eliminate trade barriers among themselves, such as tariffs and quotas. This cooperation allows for the free movement of goods, services, and sometimes labor and capital across the member countries’ borders. By forming a trade bloc, these countries can benefit from increased economic efficiency, enhance trade relations, and potentially improve their overall economic growth. The reduction or elimination of trade barriers leads to a more integrated and competitive market among the member nations, encouraging both intra-bloc trade and increased cooperation.

In contrast to this correct choice, the other options misrepresent the concept of a trade bloc. For instance, a trade agreement involving only one member doesn’t establish a bloc, as a bloc requires multiple cooperating countries. Similarly, a scenario where countries impose higher tariffs on one another contradicts the essence of a trade bloc, which is focused on lowering or removing such barriers. Furthermore, while enforcement of trade restrictions can occur in certain contexts, a coalition that primarily enforces trade restrictions does not align with the cooperative spirit inherent in trade blocs, which aim for reduction of those restrictions.