Exhibit 5-10 GDP data (billions of dollars)

In Exhibit 5-10, and using the expenditures approach, compute net exports (X-M). Which of the following is correct ?

Question

Exhibit 5-10 GDP data (billions of dollars)

In Exhibit 5-10, and using the expenditures approach, compute net exports (X-M). Which of the following is correct ?

Quizplus · Accepted Answer

Net exports (X-M) can be calculated by subtracting imports ($750 billion) from exports ($700 billion): 
$700 billion - $750 billion = -$50 billion. This means that the country has a trade deficit, indicating that it is importing more goods and services than it is exporting.

Exhibit 5-10 GDP Data (Billions of Dollars)