Question

Ceteris paribus, how does a recession in the United States affect U.S. net exports?

Answer 1

Keeping all the other things constant, if recession it's the US economy production activity in the United States decreases in a great extent which means the output would be less andthe total exports of the country would decrease drastically. This can lead to increasing the demand for imports but the increase doesn't mean I increase because the relative incomes of the people also would fall in the current economy and and it can be mentioned that the exports decrease very drastically when compared to that of inputs which can either slightly rise of slightly fall and therefore if there is a recession prevailing in the country then the net exports will decrease in perspective of the United States.