an increase in net exports will shift the:,

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An increase in net exports will shift the: An increased level of net exports is a sign that a country’s economy is doing well. When it comes to trade, countries have two broad options for dealing with their currency: they can either devalue or appreciate. If one country wants to become more competitive and get its goods into another country’s markets, then it may decide to devalue its currency. This means that people will need less money from their own country when they buy imports like food and clothing from other countries. Alternatively, if the second nation has an unfavorable exchange rate with respect to the first (meaning consumers need more of their own currency to purchase imports), then it may choose to take measures such as intervening in foreign markets to try and keep the value of their currency high. In both cases, this leads to a decline in net exports for the first country because its goods are now more expensive and it becomes less competitive on world markets. In contrast, when an economy chooses not to devalue or appreciate its exchange rate, then we see what is called a “favorable” scenario for trade – one where countries have little incentive to buy from other nations thanks to low import costs but can still export as usual without being undercut by competitors with cheaper currencies. All things considered, though the two scenarios seem different at first glance (and indeed they do result in very different outcomes), there’s no real difference between them: either way you need money from your own nation


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