Question

Which statement below is not an economic impact of the North American Free Trade Agreement?
(1 point)
• Elimination of tariffs between member nations reduces the cost of goods.
• The largest market for Canada's agricultural exports is the United States.
• Economic collaboration through intercontinental trade has created a bloc among North American countries.
• Mexican businesses have relocated to the United States where labor costs are lower.

Answer 1

The incorrect statement is the fourth one: "Mexican businesses have relocated to the United States where labor costs are lower."

Why: Labor costs are generally lower in Mexico, so companies (largely U.S. and Canadian firms) have relocated production to Mexico to save on labor — not the other way around.