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Usa China Trade Relations

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Submitted By norseman92
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U.S.A.-China Trade Relations
Carol Buchanan
Naga S. Grandhi
Leigh Goulet
Bellevue University

Abstract
The United States of America (also referred to as U.S.A.) and China are the top two biggest economies with $16.2 trillion and $9 trillion dollars respectively. Both of these countries have very strong trade relationships. In the year 2013, U.S.A. exported $122,016.3 million worth of goods to China and imported $440,433.5 worth of goods from China. These figures clearly indicate that there was a huge difference between import and export values in 2013 and also appear to disproportionately favor China. This paper addresses the trade relation between these countries and explains its current situation. This paper also explains the concept of “opportunity cost” as it relates to trade between these countries.
Keywords: U.S.A.-China trade relations, imports, exports, opportunity cost.

U.S.A.-China Trade Relations

Problem Statement
Both the U.S.A. and China have strong economic backgrounds. Globalization welcomed trade between these nations. Overall, the balance of trade in goods and services between U.S.A. and China appears to be in favor of China. This creates several problems and dependencies between these two countries.

Introduction/Background
U.S.A.-China trade rose rapidly after the two nations reestablished diplomatic relations (in January 1979), signed a bilateral trade agreement (July 1979), and provided mutual most-favored-nation (MFN) treatment beginning in 1980 (Morrison, 2014). Figure 1 shows a comparison between U.S.A. and China.

Figure 1: Comparison between U.S.A. and China
Source: http://www.theguardian.com/
U.S.A. and China exchange goods and services with each other in the form of exports and imports. The ratio between these imports and exports to China from the U.S.A. varies every year. Figure 2 shows statistics from the year

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