Using the expenditure approach to deriving gross domestic product, if U.S. imports rise and exports remain the same
A) GDP rises.
B) GDP remains the same.
C) GDP falls.
D) GDP indicates a recession.

Question

Quizplus · Accepted Answer

An increase in imports means that more goods and services are being purchased from abroad, which effectively means a decrease in domestic production. As a result, GDP falls. The fact that exports remain the same is irrelevant in this case.

Using the Expenditure Approach to Deriving Gross Domestic Product, If