Suppose a U.S. computer company outsources its technical-support services to India. This will cause
A) the demand for labor in the United States to fall, lowering U.S. wage rates, and the demand for labor in India to increase, increasing Indian wage rates.
B) the demand for labor in the United States to increase, lowering U.S. wage rates, and the demand for labor in India to fall, increasing Indian wage rates.
C) the demand for labor in the United States to fall, lowering U.S. wage rates, and the demand for labor in India to fall, decreasing Indian wage rates.
D) the demand for labor in the United States to increase, increasing U.S. wage rates, and the demand for labor in India to fall, decreasing Indian wage rates.
Answer: A
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