Question

1. Which sector (household, business, or international ) spends the most?Which sector spends the least? Which sector has the most volatility of spending?

2.What does it mean if net exports are negative?

Answer 1

Question 1

With respect to economic data pertaining to spending by different sectors of an economy,

It is the household sector that spends the most.

It is the international sector that spends the least.

The most volatile spending scenario is experienced in case of business sector because business spending depends of macro-economis expectations, interest rate movement etc. Slight change in any of these leads to significant change in business spending.

Question 2

Net exports are calculated as follows -

Net exports = Exports - Imports

So,

Negative net exports implies that imports would be greater than exports or imports of a country exceeds the exports of a country.