An increase in U.S. private saving

The correct answer is:

a. increases U.S. net exports and U.S. net capital outflow the same amount.

When U.S. private saving increases, it typically leads to an increase in the supply of loanable funds, which can lower interest rates. This may result in increased investment in the U.S. as well as more savings being available for foreign investments, thereby increasing net capital outflow. With more savings and lower interest rates, the availability of domestic funds for consumption decreases, which can lead to improved net exports as domestic consumption of foreign goods decreases. Both net exports and net capital outflow would increase as a result of this process.