Which term describes a system where trade could flow freely across the border between colonies and the United States, with no import taxes?

• A. Mercantilism
• B. Tariff Barrier
• C. Free Trade
• D. Reciprocity

Answer: (D)

Trade policies and tariffs shape how freely goods move across borders. When there are no import taxes, the arrangement is called Free Trade. It means goods can cross the border without duties, encouraging competition, lowering prices for consumers, and letting markets determine what’s produced and traded.

Reciprocity is related but different: it’s about two countries agreeing to lower tariffs in exchange for similar reductions by the other side. It still involves tariff changes, but not an unconditional removal of taxes everywhere. Mercantilism focuses on building national wealth through trade control, often using tariffs and colonial advantages to favor the mother country. A tariff barrier is simply a tax on imports that raises their price and restricts trade.

So the term that best describes no import taxes and freely flowing trade is Free Trade.