Question

If countries that imported from the United States went into recession, we expect that U.S. net...

If countries that imported from the United States went into recession, we expect that U.S. net exports would _________

rise, making the aggregate demand shift right

fall, making aggregate supply shift right

fall, making aggregate demand shift left

rise, making aggregate supply shift left
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Answer #1

Answer - Option C : fall, making aggregate demand shift left

The given question If countries that imported from the United States went into recession, what would happen to US net exports.

  • Net exports is equal to exports - Imports. Meaning that net exports is calculated by deducting imports from exports.
  • Since the imports are declining, this indicates that the exports are also declining.
  • Hence the net export will fall
  • Decline in net export cause the aggregate demand curve to fall meaning that aggregate demand shift left.
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