In China

Question

In China

Quizplus · Accepted Answer

As wages in China rise, the country's comparative advantage in low labor costs decreases, making it less attractive for outsourcing and manufacturing. This trend also potentially shifts production to other lower-wage countries.

Answer: C 
 The expansion of the middle class in China is a significant factor in increasing domestic consumption and driving economic growth. If the middle class does not expand, it may limit the growth potential of the economy.

Option B is incorrect as China's scale economy is a significant advantage due to its large population and capacity for mass production. Option D is also incorrect as China's coastal regions have been essential in building up trade and attracting foreign investments.