Which statement best describes a single market?

Which statement best describes a single market?

• A. Free movement of factors of production, enterprise and services
• B. Common external tariff
• C. Tariffs on intra-bloc trade
• D. Quotas on services

Answer: (A)

A single market is about removing barriers to cross-border economic activity, allowing the free movement of production inputs and business activity across member states. This is captured by the idea of free movement of factors of production, enterprise and services, which encompasses labor and capital (factors of production) and the ability for businesses to operate and provide services across borders without undue restrictions. The goal is to integrate the market so goods, services, capital and people can move with minimal friction, boosting trade and investment. The other options describe policies that are not characteristic of a single market. A common external tariff is a feature of a customs union, applying the same tariff to imports from outside the bloc. Tariffs on intra-bloc trade and quotas on services introduce barriers within the bloc, which contradict the aim of seamless cross-border activity.

A single market is about removing barriers to cross-border economic activity, allowing the free movement of production inputs and business activity across member states. This is captured by the idea of free movement of factors of production, enterprise and services, which encompasses labor and capital (factors of production) and the ability for businesses to operate and provide services across borders without undue restrictions. The goal is to integrate the market so goods, services, capital and people can move with minimal friction, boosting trade and investment.

The other options describe policies that are not characteristic of a single market. A common external tariff is a feature of a customs union, applying the same tariff to imports from outside the bloc. Tariffs on intra-bloc trade and quotas on services introduce barriers within the bloc, which contradict the aim of seamless cross-border activity.