What is the difference between exports and imports called?
Answer and explanation
Correct answer: Net exports
Net exports are calculated as the value of exports minus the value of imports, written as X − M. Exports add to domestic expenditure because they represent domestic production purchased by foreigners, whereas imports are subtracted because they are included in consumption, investment or government spending but were produced abroad. Therefore, option D is correct.
Frequently asked questions
What is the correct answer to this question?
Net exports
Why is this the correct answer?
Net exports are calculated as the value of exports minus the value of imports, written as X − M. Exports add to domestic expenditure because they represent domestic production purchased by foreigners, whereas imports are subtracted because they are included in consumption, investment or government spending but were produced abroad. Therefore, option D is correct.
Which subject and chapter does this question cover?
This is a Class 12 Economics question. Chapter: National Income and Related Aggregates. Topic: Methods of calculating national income - Expenditure Method.
