Deck 23: Variable Net Exports

Question 1

If one British pound originally exchanges for one U.S.dollar and then is revalued to exchange for two U.S.dollars,what should happen to U.S.net exports?

A) Since the pound costs more,net exports will increase.
B) Since the dollar costs more,net exports will increase.
C) Since the dollar costs less,net exports will decrease.
D) Since the dollar costs more,net exports will decrease.
E) Since the dollar costs less,net exports will increase.

Answer 1

Since the dollar costs less,net exports will increase.

Question 2

As U.S.income rises,U.S.imports will rise.

Answer 2

True

Question 3

If the U.S.economy were to go through a severe recession by itself (i.e.,without it being contagious to the rest of the world),we would typically observe an increase in the U.S.trade deficit.

Answer 3

False

Question 4

Which of the following statements regarding imports and exports is true?

A) Both imports and exports vary directly with the level of domestic income.
B) Both imports and exports vary inversely with the level of domestic income.
C) Imports vary directly with the level of domestic income; exports are independent of the level of domestic income.
D) Exports vary directly with the level of domestic income; imports are independent of the level of domestic income.
E) Both imports and exports are independent of the level of domestic income.

Question 5

U.S.economic growth does not contribute to a U.S.trade deficit.

Question 6

If imports increase as disposable income increases,economic growth will __________ net exports and contribute to a trade __________.

A) increase; deficit
B) increase; surplus
C) decrease; deficit
D) decrease; surplus
E) not affect; balance

Question 7

U.S.net exports will fall if

A) U.S.income rises
B) U.S.income falls
C) U.S.imports decrease
D) the value of the U.S.dollar falls
E) U.S.exports increase and U.S.imports are autonomous

Question 8

A decrease in U.S.income would lead to a(n)

A) increase in U.S.exports
B) decrease in U.S.imports
C) decrease in both U.S.imports and U.S.exports
D) increase in U.S.exports and a decrease in U.S.imports
E) decrease in U.S.exports and an increase in U.S.imports

Question 9

U.S.net exports will increase if

A) U.S.income increases
B) the value of the U.S.dollar decreases relative to foreign currency
C) the value of the U.S.dollar increases relative to foreign currency
D) U.S.exports decrease
E) U.S.imports increase

Question 10

An increase in the value of the U.S.dollar relative to other currencies will increase U.S.imports.

Question 11

A decrease in the value of the U.S.dollar relative to other currencies will increase U.S.exports.

Question 12

If U.S.net exports are negative,

A) U.S.consumers are spending less on foreign goods than foreign consumers are spending on U.S.goods
B) U.S.consumers are spending more on foreign goods than foreign consumers are spending on U.S.goods
C) the government should promote imports to balance international trade
D) U.S.consumers are spending more on foreign goods than they are spending on U.S.goods
E) U.S.disposable income is low

Question 13

As U.S.income falls,U.S.exports will fall.

Question 14

An increase in the value of the U.S.dollar relative to foreign currencies would lead to

A) an increase in U.S.exports and a decrease in U.S.imports
B) a decrease in U.S.exports and an increase in U.S.imports
C) an increase in both U.S.imports and U.S.exports
D) a decrease in both U.S.exports and U.S.imports
E) no change in exports and an increase in U.S.imports

Question 15

If the value of the U.S.dollar decreases relative to other currencies,the export function will shift upward and the import function will shift downward,thereby shifting the net export function upward.

Question 16

If imports are plotted on the vertical axis and disposable income on the horizontal axis,the import line

A) slopes downward,but we can tell nothing about its steepness
B) slopes downward with a slope less than -1
C) is a horizontal line
D) slopes upward with a slope less than 1
E) slopes upward,but we can say nothing about its steepness

Question 17

A decrease in the value of the U.S.dollar relative to other currencies will shift the net export function upward.

Question 18

A decrease in the value of the U.S.dollar relative to foreign currencies would lead to a(n)

A) increase in U.S.exports
B) decrease in U.S.imports
C) increase in both U.S.imports and U.S.exports
D) increase in U.S.exports and a decrease in U.S.imports
E) decrease in U.S.exports and an increase in U.S.imports

Question 19

An increase in U.S.consumers' incomes will decrease U.S.exports.

Question 20

An increase in U.S.income would lead to

A) an increase in U.S.exports and a decrease in U.S.imports
B) a decrease in U.S.exports and an increase in U.S.imports
C) an increase in both U.S.imports and U.S.exports
D) a decrease in both U.S.exports and U.S.imports
E) no change in U.S.exports and an increase in U.S.imports

Question 21

Which of the following would shift the U.S.net export function upward?

A) an increase in the value of the dollar relative to other currencies
B) a decrease in the value of the dollar relative to other currencies
C) an increase in incomes in the U.S.relative to other economies
D) an increase in the U.S.price level relative to other economies
E) a decrease in foreign incomes relative to U.S.incomes

Question 22

In 2007,the value of the dollar declined,which should have __________ exports,__________ imports,and shifted the net export function __________.

A) increased,decreased,downward
B) increased,increased,upward
C) increased,decreased,upward
D) decreased,decreased,downward
E) decreased,increased,downward

Question 23

Which of the following factors is not assumed constant along the U.S.net export function?

A) U.S.price levels and foreign price levels
B) interest rates in the U.S.and abroad
C) exchange rates between the U.S.and other currencies
D) foreign income levels
E) income levels in the U.S.

Question 24

Which of the following would shift the U.S.net export function downward?

A) an increase in the value of the U.S.dollar relative to other currencies
B) a decrease in the value of the U.S.dollar relative to other currencies
C) a decrease in U.S.incomes relative to other countries
D) a decrease in U.S.price levels relative to foreign price levels
E) an increase in foreign incomes relative to U.S.incomes

Question 25

Subtracting the import function from the export function produces the net export function.