Q1. [1] straightforward thorough-understanding
Which of the following best explains why countries like China became attractive destinations for MNCs relocating their production operations from the 1970s onwards?
(A) China had accumulated large financial reserves by exporting goods to Europe since the 1950s.
(B) The decline of the Soviet Union left China as the sole dominant global manufacturing power.
(C) Low wages in China allowed MNCs to reduce production costs and compete more effectively in world markets.
(D) China eliminated all trade barriers, making it the most open economy in Asia.
- A China had rejoined the world economy after 1949 and built up large financial reserves.
- B The collapse of the Soviet Union made China the dominant global power.
- C Low wages in China allowed MNCs to reduce costs and compete more effectively in world markets.
- D China imposed high import tariffs, forcing MNCs to manufacture locally.
Generated by claude-sonnet-4-6 · 2026-06-26 15:03 · grounding rag
Model Answer
(C) Low wages in China allowed MNCs to reduce costs and compete more effectively in world markets.
Explanation
The passage directly states: "Wages were relatively low in countries like China. Thus they became attractive destinations for investment by foreign MNCs competing to capture world markets." Options A and B are factually distorted, and D contradicts the passage. Always quote or paraphrase the source text for MCQ justification.