U.S. Export and Imports Firstly,

U.S. export and imports

Firstly, some goods have an inelastic and lower price in China, therefore, Yuan's appreciation cannot significant affect U.S. export and import. A product that is price inelastic is one that the change in price does not necessarily mean there will be a change in the demand. Here the price of the product does not have any bearing on the demand and supply of that particular item. Such goods will have the prices change but there will be no significant reduction or increase in the demand levels (Don Hofstrand, 2007). An appropriate example is the price of gasoline. When there is an increase in the price of gasoline it does not necessarily mean that consumers will stop using the commodity, in the same breath a drop in the prices does not mean that there will be more people using gasoline on the roads in a particular day. One salient example in the case of export and imports between the U.S.A. And China is the U.S.A. importing electrical machinery and equipment. If there is an increase in the market value of the Chinese Yuan or a drop in the same, there will be little change in the demand level of the machinery since the need to install an electric machinery will still remain ad will not be reduce due to increase in price. The same remains true with most of the items that USA imports from China like the power generating equipment, toys and sports equipment, furniture, footwear, apparel, plastics, iron steel and vehicles. The same will stand for the items that the U.S.A. exports to china since they are items whose demand is not easily influenced by the change in the prices for instance the export of the optics and medical equipment will not be affected in terms of the demands with the strengthening of the Yuan against the dollar or otherwise. The same remains true for the other major items that China buys from the U.S. like organic chemicals, oil seeds, vehicles, aircraft, copper and such like (The U.S.-China Business Council, 2013). In a nutshell, the inability of the import/export influence with the appreciating/depreciating Yuan against the Dollar is informed by the kind of goods that is traded between the two countries.

U.S. And China do not depend on each other in some fields, so when Yuan appreciates, U.S. export and import do not have significant results. For example, U.S. And China are vast agricultural countries; therefore, both countries can autarky. According to Truman National Security Project (2013), there has been an increase in the recent year of the two countries to stay in trade partnerships. What this means is that there is no country between the two that can effectively boast of the ability to eliminate the other in terms of trade. This notion sprouts from the fact that none of the two depends on the other 100% to economically progress. The fact that both countries have highly sufficient economies and produce a lot of basic needs within their borders is a clear indicator that the dependence on each other is not overly skewed towards one direction. Looking at the list of import/export between the two countries it will be noted that the type of goods that the two countries trade between them are not basic goods that must be used at the family level on a daily basis for consumption, but the secondary goods that can be kept on hold if here is not sufficient funds. This means the two countries have largely autonomous economies that can allow them to feed their people without having to depend on one another. What this implies is that if the value of the Yuan strengthens against the Dollar there is little likelihood of change in the consumption patterns or export trend between these two countries. The two countries do not depend on each other particularly in the food consumer goods but are more inclined towards the non-food consumer goods. From Table 4 and 6 we can find that fuels and lubricants industry also does not significant results for both export and import.