Question

Jane Ferlengeti, a U.S. citizen, purchases a phone for $300 that Apple imported from China. Apple paid its Chinese subsidiary $150 for the phone. How did these transactions change the U.S.–Chinese bilateral trade balance?

Answer 1

$150

Step-by-step explanation:

Data provided as per the question is below:-

Phone Purchase cost = $300

Paid Chinese subsidiary = $150

The computation of change the U.S.–Chinese bilateral trade balance is shown below:-

Trade balance = Phone Purchase cost - Paid Chinese subsidiary

= $300 - $150

= $150

Therefore for computing the trade balance we simply subtract Paid Chinese subsidiary from Phone purchase cost.