Question

A country has $60 million of saving and domestic investment of $40 million. Net exports are
a.

$20 million.
b.

-$100 million.
c.

-$20 million.
d.

$100 million.

Answer 1

To determine the net exports for the country, we can use the savings-investment identity, which states:

\[
\text{Net Exports} = \text{Savings} - \text{Domestic Investment}
\]

Substituting the given values:

\[
\text{Net Exports} = 60 \text{ million} - 40 \text{ million} = 20 \text{ million}
\]

Therefore, the correct answer for net exports is:

**a. $20 million.**