Question
In: Economics
Explain how net exports affect the U.S. economy. Describe both negative and positive impacts on GDP....
Explain how net exports affect the U.S. economy. Describe both negative and positive impacts on GDP. Why do national income accountants use net exports to compare GDP, rather than simply adding exports to the other expenditure components of GDP?
Solutions
Expert Solution
1) The international trade involves both export and import goods from one country to another country.The country's total value of export and imports.The net export of a country depends on import more or export more the value can be negative or positive
The net export is calculated as follows
Net export = value of export-value of import
2) The positive net export is the income of the country another hand negative net exports value is the outflow of the income from the country.And it is considered in GDP
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