A firm that has a manufacturing unit in China considers shifting production to Cambodia. Which of the following would be a possible reason for it to not shift the production base?
A)Lower wages for labor in Cambodia
B)Lesser skilled labor in Cambodia
C)Higher productivity in Cambodia
D)Rising labor costs in China
E)Higher transportation cost in China

Question

Quizplus · Accepted Answer

Some firms are shifting production from China to other parts of the world, reasons that include rising labor costs and transportation/logistics costs in China. Part of the advantage of shifting production is offset by lower productivity, where workers produce lesser number of outputs than their Chinese counterparts.

A Firm That Has a Manufacturing Unit in China Considers