Question

7. Problems and Applications Q1 Indicate how each of the following transactions affects Canada's exports, imports, and net exports. Canadian Exports Unchanged Effect On. Canadian Imports Canadian Net Transaction A Canadian art professor spends the summer touring museums in Europe. Students in Paris flock to see the latest Diana Krall concert. Your uncle buys a new Volvo The student bookstore at Oxford University in England sells a pair of Bauer hockey skates. Exports Unchanged Unchanged

Answer 1

The spending by Canadian professor will increase imports and leave exports unchanged. Hence net exports will decrease

Students expenditure will increase Canadian exports and imports are unchanged. This causes net exports to increase.

Purchase of volvo is import so imports are increased and exports are unchanged so that net exports will decrease

The last activity will raise net exports as well as exports but imports remain unchanged.