Question

Over the last two years, an american clothing company has partnered with a manufacturer in china to make clothes at a cheaper cost. How is this mutually beneficial?.

Answer 1

The mutual benefit that the American Clothing Company derives by partnering with a Chinese Manufacturer comes because E. It is an example of counter-trading ...

What is Counter-trading?

Counter-trading occurs when goods or services are exchanged for other goods or services rather than for hard currency.  It is a reciprocal form of international trade in which, for example, the American Clothing Company brings in its technology while the Chinese Manufacturer provides cheap labor and other resources.

Answer Options:

A. It is a strategic alliance in which two countries share the risks and rewards of starting a new enterprise together in a foreign country.

B. It is a wholly owned subsidiary in which a foreign subsidiary is totally owned and controlled by an organization.

C. It is a greenfield venture in which owning the organization has been built from scratch.

D. It is an example of a franchise in which a company allows a foreign company to pay it a fee and a share of the profit in return for using the first company’s brand name and a package of materials and services.

E. It is an example of counter-trading in which the country is bartering for goods.

Thus, the counter-trade between these companies is mutually beneficial because of Option E.

Learn more about counter-trading at brainly.com/question/14659049