During the past 10 to 20 years, a considerable amount of foreign capital has flowed into China. What is an implication of capital flow on the composition of Chinese trade?
A) There should be no change in the composition of China's trade.
B) There should be a shift toward the export of more labor-intensive products.
C) There should be a shift toward the export of more capital-intensive products.
D) There should be a shift toward the import of more capital-intensive products.

Question

Quizplus · Accepted Answer

When foreign capital flows into China, the country can improve its technological capabilities, infrastructure, and productivity. As a result, China can shift towards the export of more capital-intensive products, such as machinery, electronics, and high-tech products. This is because China can now produce these products more efficiently and at a lower cost. Therefore, the answer is C.

During the Past 10 to 20 Years, a Considerable Amount