Economics · May / June 2017 · Paper 11 · Question 30

In 2015, China was the world’s largest exporter of manufactured goods and a major importer of oil and minerals. China devalued the yuan (renminbi) by 2%. According to economic theory, what would have been a consequence of this devaluation?

1. AChina paid less in foreign currencies for imports.
2. BChina reduced its demand for oil and minerals.
3. CChina’s exports became less competitive.
4. DChina’s trading partners improved their balance of trade with China.

As printed in the paper