A French firm exchanges euros for $50,000 from a U.S.bank.The French firm then uses the dollars to purchase $50,000 of legal services from a U.S.law firm.As a result of these two transactions alone

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The French firm's purchase of dollars from a U.S. bank represents a capital outflow from the United States, as the dollars are leaving the country. The French firm's subsequent purchase of legal services from a U.S. law firm represents an increase in U.S. net exports, as the goods and services are being exported from the United States.

A French Firm Exchanges Euros for $50,000 from a U