Question

3. What is net export function? With the help of diagram, Explain, the factors responsible for the shift in the
net export function and its impact on national income and output.
3.
शुद्ध निर्यात फलन क्या है ? चित्र की सहायता से शुद्ध निर्यात में परिवर्तन लाने वाले कारको तथा
इसका राष्ट्रीय आय अवं उत्पादन पर प्रभाव को समझाइए |​

Answer 1

NET EXPORT FUNCTION

1. Net exports is defined as the difference between the total value of export and import by that particular country.

2. Net Export Function is usually used to estimate the public demand for goods and business generates within the economy.

3. Factors responsible for the shift in the net export function are-

• Domestic and Foreign Income
• Domestic and Foreign Trade policies
• Relative Price Level
• Technologies
• Preferences
• Exchange Rates etc.

4. There are many impacts on national income and output due to this and are as follows-

• Change in the price level can result in a change in net exports.

• Above mentioned factors can results in the economy which will move along its aggregate demand curve.

• If demand is high, businesses increases and exports will be high making the country rich and vice versa.