When the price level in the United States rises relative to the price level of other countries,________ will rise,________ will fall,and ________ will fall.
A)imports; exports; net exports
B)exports; imports; net exports
C)net exports; exports; imports
D)net exports; imports; exports

Question

Quizplus · Accepted Answer

When the price level in the United States rises relative to other countries, it becomes more expensive for foreigners to purchase U.S. goods, leading to a decrease in exports. Conversely, foreign goods become relatively cheaper for Americans, increasing imports. As net exports are calculated as exports minus imports, an increase in imports and a decrease in exports will lead to a fall in net exports.

When the Price Level in the United States Rises Relative