USA exports 700 billion dollars to China. USA buys 500 billion dollars from Chin

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Question

USA exports 700 billion dollars to China. USA buys 500 billion dollars from China.

Are USA net exports positive or negative? What are they?

Which country has positive net capital outflow?

What does that mean?

What does the country with positive net capital outflow do with the difference between the funds?

USA exports 700 billion dollars to China. USA buys 900 billion dollars from China.

Are USA net exports positive or negative? What are they?

Which country has positive net capital outflow?

What does that mean?

What does the country with positive net capital outflow do with the difference between the funds

USA exports 700 billion dollars to China. USA buys 500 billion dollars from China.

Are USA net exports positive or negative? What are they?

Which country has positive net capital outflow?

What does that mean?

What does the country with positive net capital outflow do with the difference between the funds?

USA exports 700 billion dollars to China. USA buys 900 billion dollars from China.

Are USA net exports positive or negative? What are they?

Which country has positive net capital outflow?

What does that mean?

What does the country with positive net capital outflow do with the difference between the funds?

In the first case:- When USA exports 700 Billion Dollars worth to china, and imports 500 Billion Dollars of worth from china.

1. Net Exports = 700 - 500

= 200 Billion Dollars.

USA's Exports are positive, that is 200 Billion Dollars.

2. In the above situation USA has net positive capital outflow, it means that US economy is growing or boosting with positive balance of payments.

3. USA will further invest the money in growing infrastructure, research and technology.

In the second case:- When USA exports 700 Billion Dollars worth to china, and imports 900 Billion Dollars worth from china.

1. Net Exports = 700 - 900

= - 200 Billion Dollars

USA's Net Exports are now negative, by 200 Billion Dollars.

2. In this case china has positive net capital outflow.

3. china will again invest the money on labour reforms, wage parity programmes, good infrastructure, science and technology.

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