Net exports would rise since the recession would not affect foreign demand (if not increase it due to the lower price) and imports would certainly fall as the determinants for aggregate demand are the same as for demand of imports.
if ECB increase monetary policy lowering interest rates...i would say that suppy of euros in the forex market increase so ER falls rather than ER falling because a lower demand of euros in the forex market... what do you think about my thoughts...
Great as always thanks Jason
Got this question, dirving me mad, what happens to net exports and the balance of payments in times of a recession?
Net exports would rise since the recession would not affect foreign demand (if not increase it due to the lower price) and imports would certainly fall as the determinants for aggregate demand are the same as for demand of imports.
(For a demand deficient recession)
In the case of a supply shock recession, prices would rise causing foreign demand and exports to fall and imports to rise.
Thank you so much!
Wow great explanation! Thank you~
Awesome very helpful! Thank you!
thank you so much, this was really helpful.
if ECB increase monetary policy lowering interest rates...i would say that suppy of euros in the forex market increase so ER falls rather than ER falling because a lower demand of euros in the forex market...
what do you think about my thoughts...