In the calculation of gross domestic product net exports are ?
Correct answer: A. the sum of merchandise trade and services
- A. the sum of merchandise trade and services
- B. the current account plus long-term capital
- C. the value of merchandise exports minus imports
- D. short-term capital plus the basic balance
Explanation
Net exports in GDP are calculated as exports of goods and services minus imports of goods and services. Thus they include merchandise trade plus services, not merely merchandise exports minus imports.
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The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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