AP Macroeconomics : Net Exports
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Example Questions
Example Question #1 : How To Find Net Exports
A depreciation in the value of a nation's currency will lead to what?
An increase in wages
Higher exports
Higher imports
An increase in tax revenue
Higher exports
A devaluation of a currency makes a nation's goods cost less to holders of foreign currency. Since the goods are now cheaper, there will be an increase in the quantity of goods demanded by holders of foreign currency. More foreigners buying goods means those goods must be shipped to them leading to an increase in exports.
Example Question #1 : How To Find Net Exports
A trade surplus results from a country having __________.
net exports that equal more than one half of total GDP
more net exports than net imports
more net imports than net exports
net imports that exceed the total GDP
net imports that equal less than one third of total GDP
more net exports than net imports
Net imports describe all goods brought into a country through trade, and net exports describe all goods sold to foreign countries. A trade surplus describes any situation in which net exports are greater than net imports. A trade surplus is a target for most nations.
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