Factors Affecting Net Exports

Question 1

what are the 3

Answer 1

1. overseas/domestic econ activity
2. exchange rate
3. movements in ToT

Question 2

what influence does domestic econ activity have on net exports

Answer 2

influence AUs willingeness to import, imports elastic to GDP changes because limited manufacturing sector in Aus

Question 3

what influence does global econ activity have on net exports

Answer 3

when other economies grow demand for our commodities increases but control by seasons

Question 4

how do changes in Exchange Rate influence net exports (appreciation example)

Answer 4

domestic buyers buy more of another currency so imports are cheaper

Question 5

how do movements in ToT influence net exports

Answer 5

Increased XPI = increases net exports