Net Exports are defined as:

Net Exports are defined as:

• A. Exports minus Imports
• B. Imports minus Exports
• C. Net Exports
• D. Trade Balance

Answer: (A)

Net Exports measure the value of what a country sells abroad minus what it buys from abroad. In national income accounting, this is the difference between exports (X) and imports (M), written as NX = X − M. This quantity is part of the GDP identity, where GDP = C + I + G + NX. If exports exceed imports, NX is positive, indicating a trade surplus; if imports exceed exports, NX is negative, indicating a trade deficit. Using imports minus exports would invert the sign and would not represent net exports. Saying “Net Exports” or “Trade Balance” can be used in some contexts, but the precise definition is exports minus imports.

Net Exports measure the value of what a country sells abroad minus what it buys from abroad. In national income accounting, this is the difference between exports (X) and imports (M), written as NX = X − M. This quantity is part of the GDP identity, where GDP = C + I + G + NX. If exports exceed imports, NX is positive, indicating a trade surplus; if imports exceed exports, NX is negative, indicating a trade deficit. Using imports minus exports would invert the sign and would not represent net exports. Saying “Net Exports” or “Trade Balance” can be used in some contexts, but the precise definition is exports minus imports.