The wide-spread recessions of 2007-2009 caused a reduction in German exports and reduction in net exports for Germany, shifting the German aggregate demand curve. Which of the following factors would also cause a reduction in Germany's net exports and shift Germany's aggregate demand curve?
A)real GDP in Germany increasing faster than real GDP in other countries
B)a decrease in the exchange rate of the Euro relative to other currencies
C)a decrease in the price level in Germany
D)an increase in the price level in Germany

Question

Quizplus · Accepted Answer

When real GDP in Germany increases faster than in other countries, Germans are likely to import more, while exports may not increase at the same rate, reducing net exports and shifting the aggregate demand curve left.

The Wide-Spread Recessions of 2007-2009 Caused a Reduction in German