In an open economy, economy's net exports:
A) increase if domestic income increases.
B) increase if foreign income increases.
C) increase if MPZ increases.
D) investment increases.

Name: In an open economy, economy's net exports: A) increase if domestic income increases. B) increase if foreign income increases. C) increase if MPZ increases. D) investment increases.
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Question

Quizplus · Accepted Answer

Net exports increase if foreign income increases because foreign consumers have more income to spend on domestic goods, boosting exports.

In an Open Economy, Economy's Net Exports