Economics Paper 2, Nov/Dec. 2011  
Questions: 1 2 3 4 5 6 7 8 9 10 11 12 Main
General Commsents
Question 6

(a)        What is a customs union?
(b)       Explain any four ways in which a customs union can speed up the economic growth of its members.


(a)        A customs union is the form of economic integration where all barriers are
removed on trade between member countries.  In addition, a common tariff is imposed on trade with the rest of the world.

(b)        A customs union can speed up economic growth through the following means:
(i) large scale production;
(ii) efficiency in production;
(iii) being an effective bargaining force;
(iv) pooling resources together;
(v) attraction of foreign investment.

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