An increase in U.S. purchases of foreign-built automobiles would increase U.S.:
A) exports.
B) imports.
C) net exports.
D) investment spending.

Question

Quizplus · Accepted Answer

When the U.S. purchases more foreign-built automobiles, it is importing these goods. Therefore, U.S. imports increase. Net exports (exports minus imports) would decrease, not increase, with an increase in imports. This transaction does not directly affect U.S. exports or investment spending.

An Increase in U