Which of the following expressions represents net exports (NX)?

Question

Quizplus · Accepted Answer

Net exports (NX) are calculated as the difference between a country's total exports and total imports. The expression that correctly represents this in the context of national accounts, where S is savings, T is taxes, G is government spending, and I is investment, is given by rearranging the components of the national income identity (Y = C + I + G + NX) and considering that savings (S) equals Y - C - T. Thus, NX can be represented as S + T - G - I, which matches choice E. This is because net exports can also be seen as the portion of a country's output that is not consumed domestically (C), not invested domestically (I), and not purchased by the government (G), but instead is available for export after accounting for taxes (T) and savings (S).

Which of the Following Expressions Represents Net Exports (NX)