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Chinese wages are rising, possibly leading to increased prices of the country’s exported goods. For decades, plentiful Chinese labor kept down the cost of a range of goods bought by Americans. Even as some accused China of hollowing out the American manufacturing sector, cheap DVD players, sweaters, and barbecue sets were a silver lining for consumers who grew accustomed to ever-lower prices. Examine these trends and write a short paper discussing the following:
What might the likely effect be for the world economy and particularly the United States economy if prices of all goods from China increased?
How might this affect your disposable income?
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