Which of the following actions could be taken to encourage international trade?

• A. Reducing tariffs and trade barriers
• B. Implementing strict currency controls
• C. Increasing export taxes
• D. Imposing quotas on imported goods

Answer: (A)

Verified step by step guidance

1. Understand the concept of international trade: it involves the exchange of goods and services across countries, which can be encouraged by making trade easier and less costly.
2. Recognize that tariffs and trade barriers (such as quotas and import restrictions) increase the cost of trading internationally, thus discouraging trade.
3. Identify that reducing tariffs and trade barriers lowers the cost and restrictions on imports and exports, making international trade more attractive and feasible.
4. Note that implementing strict currency controls, increasing export taxes, or imposing quotas on imported goods generally restrict trade by making it more difficult or expensive.
5. Conclude that among the options, reducing tariffs and trade barriers is the action that encourages international trade by promoting freer exchange between countries.