News Information (1)

"Controls in place to stem the spread of the virus have halted the movement of people, brought business activityto a standstill and closed offices up and down the country," ratings giant S&P Global said in a report on Wednesday.

News Information (2)

The restaurant sectorin China will see a "significant" fall in first-quarter sales, S&P Global said. The firm projected those figures will only be around 45% to 55% of sales revenue during the same period last year.

News Information (3)

As compared to the 2002-2003 SARS epidemic, the new coronavirus outbreak will have a "more severe impact" on the property sector, said S&P Global.

Source: Tan, W. (2020). Here are the Chinese industries likely to be hit hardest by the coronavirus outbreak, CNBC News. Accessed from: https://www.cnbc.com/2020/02/20/here-are-the-chinese-industries-likely-to-be-hit-hardest-by-coronavirus.html

(a)Based on the THREE (3)news information, identify the impact of the economic activities on balance of payment of China.

News Information

Account Affected (Current account/

Capital or Financial account)

Components

(Trade balance/

Service balance/

Capital etc.)

Impact

(Increase/

Decrease)

(1)

(2)

(3)

(b)Based on your answer in (a), identify the impact on reserve assets in China.

(c)Based on News Information (1), will it affect the exporting activities of China? Discuss.

(d)Based on your answer in (c), discuss if export subsidies are relevant.

(e)Does exporting activities relevant to national income in China? Explain. (hint: refer to the national income approaches.)

(f)Discuss TWO (2)reasons that preventChina from obtaining accurate figures for national income.