University of Hong Kong

CCCH9007 China in the Global Economy

(Spring 2021)

Quiz Two
(100 points total)

Instructions for the quiz:

1. Due for submission: April. 7th, 2021 4:35 pm on Moodle

2. Time period of 4:20 pm-4:35 pm is only for submission on Moodle
3. File name: please use the following format in naming your file: QuizTwo_Student
ID_name.docx
4. Both direct answer through word file or scanned/photo copy of handwriting file will
work; And clearly mark the question number if you choose to write on your own paper;
5. This quiz should be done individually. Identical answers with your classmates’ work
are considered as plagiarism, which will lead to a zero score for that question or even
the failing grade for the entire course.
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SECTION I: CHOICE QUESTIONS

Note:
 There is at least one correct answer for each question.
 Please select all the correct answers to get the point for that question. Inclusion of any incorrect answer or
missing any correct answer will get you lose the whole points for each question.
 The wording of the question (statement vs statements) has NO relation with the number of correct answers
 Each question accounts for 3 points out of 100 points in this quiz.
 Please write your answers for choice questions in the table below:

Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10
                 

1. Which statements CORRECT about China’s exchange rate:

A. According to the Big Mac Index, RMB has been undervalued for a long time
B. China’s currency has pegged to the US dollars since the financial crisis of 2008
C. In order to benefits its export, China has to maintain the undervalued exchange rate
D. China used to adopt the clean float regime in determining its exchange rate

2. The CORRECT statements about China’s growth performance include:

A. China has surpassed the United States in the total nominal GDP
B. China has the largest proportion of the global GDP based on the Purchasing Power Parity in
2020
C. China has changed to be a major contributor to the growth of world GDP even during the
downturn of world economy
D. China maintained an average growth rate of 10% between 1979 and 2012

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3. The CORRECT statements about the driving forces of China’s growth include:
A. Sufficient low-cost labor contributed the most to China’s economic growth since China
joined WTO
B. Expanding investment was a major driving force to China’s economic growth since the
economic reform
C. Rising investment has been fueled by the high level of gross domestic savings in China
D. Technology has become the most important driving force to China’s GDP growth since
2008

4. The CORRECT statements about state capitalism in China include:

A. China’s state-owned enterprises (SOEs) monopolize the downstream industry
B. Most of the SOEs in China are managed by the State-Owned Supervision and
Administration Commission (SASAC)
C. The contribution of SOEs to China’s urban employment has been declining in the past ten
years
D. The total wages paid by the SOEs to the urban employees has been increasing since 2000

5. Which statements are NOT CORRECT about the international trade of China:
A. China has transformed from an isolated economy to an open economy
B. The trade structure is concentrated
C. Processing trade is still taking about one third of total trade in China
D. China is highly competitive in technology-intensive goods in the trade

6. In which year, China joined WTO:

A. 1949
B. 1978
C. 1986
D. 2001

7. Which statements about China’s commitment of joining WTO are CORRECT:

A. Significant tariff reduction to be below 10 percent on average
B. Remove all the quotas
C. Open all the business of banking industry
D. Reduce tariff of agriculture products to be 17%

8. Although it is acknowledged that trade will bring benefit by increasing the total output
through specialization, it has shown increasing voice about anti-globalization, their
reasons are:
A. For getting back more jobs to the home country
B. To increase the wage and income for its citizens
C. To protect the key industry to maintain the economic growth of its home country
D. For national security reasons

9. Based on our discussion in the class, Trump’s rationales for tariffs against China include:
A. US trade deficit with China has soared since 1985 which hurts US manufacturing and
employment
B. China gains access to U.S. technology by employing many unfair procedures.

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 C. China’s industrial policy, especially “Made in China 2025”, involves substantial subsidies
and support to the state-owned firms, which further hurt US economy
D. China did not successfully fulfil the commitments to access to WTO

10. The CORRECT statements about China in the global value chain (GVC) include:
A. China has emerged to be an important supply hub in traditional trade and simple GVC
network
B. China has become a unique supply hub in the industry of information communication and
technology among Asian countries
C. China is the most important supply hub in the complex GVC network
D. China is a dominant demand hub in complex GVC network

SECTION II: DISCUSSION QUESTIONS

A. China’s Growth Miracle (35 points)

Based on your understanding about different driving forces to China’s economic growth, please state the
most important contributor during the past 40 years and explain why? (Max words: 100)

B. Industrial and Trade Policy in China (35 points)

As we discussed during the class, the processing trade was a major form of trade in China. Please list two
reasons and explain why China has chosen processing trade as its major trade since China started to open
up in 1979? (Max words: 100)

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