Which of the following statements about structure of International Production Networks (IPN) is INCORRECT?

a.

IPN could be considered as multinational subsidiaries, which have headquarters in one country and operates several in different countries.

b.

IPN uses multiple-inputs (e.g. engines, body, seats for a car) - which can be only produced and outsourced to firms in foreign countries.

c.

iPhone and iPad are shining successful examples of IPN.

d.

IPN produces a final good for serving home and foreign markets.

Which of the following is NOT a challenge for Chinese economy in sustaining the accelerated rate of economic growth?

a.

Excess capacity of manufacturers.

b.

Environmental degradation (although China is heavily investing into renewable energy).

c.

The income gap has widened, and the regional disparity has increased.

d.

Rising labour cost