Consider the net export function.An increase in domestic national income,other things being equal,is assumed to cause
A)the net export function to shift upward.
B)the net export function to pivot upward.
C)movement to the right along the net export function.
D)the net export function to pivot downward.
E)no effect on net exports.

Question

Quizplus · Accepted Answer

An increase in domestic national income, other things being equal, typically leads to an increase in imports as residents buy more foreign goods. This results in a movement to the right along the net export function, reflecting a decrease in net exports (exports minus imports).

Consider the Net Export Function