According to the text,relative changes in wage rates among nations may cause the multinational firm to

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According to the text, relative changes in wage rates among nations may cause the multinational firm to change its sources of supply from one country to another. For example, Nike, which has no production in the United States, began using Japanese plants in 1964. When labor costs rose there in the mid-1970s, the company changed to factories in South Korea and Taiwan and later added Thailand. But as labor costs rose in those countries, Nike shifted most of its production to contracted factories in China. As wage rates rose in China, Nike became concerned because its $75 to $175 (retail) shoes were costing as much as $10 to produce and ship to the United States. The company has undertaken efforts to move production to other locations, where wage rates can be at least 30 percent lower. The company now produces in 719 factories in 44 countries, although much of its shoe production remains in low-cost Asian nations such as Indonesia and Vietnam.

According to the Text,relative Changes in Wage Rates Among Nations