A parallel upward shift in the net export (NX)function can be caused by
A)an increase in domestic national income.
B)an increase in foreign national income.
C)an increase in domestic prices relative to foreign prices.
D)a decrease in the Canadian-dollar price of foreign currency.
E)a decrease in foreign prices relative to domestic prices.

Question

Quizplus · Accepted Answer

An increase in foreign national income would increase the demand for domestic goods and services, leading to an increase in exports and an upward shift in the net export function.

A Parallel Upward Shift in the Net Export (NX)function Can