When a u.s. company purchases and imports electronic parts from china to use to produce mp3 players within the united states, th
is purchase increases the component of gdp while also net exports by the same amount. therefore, the purchase of electronic parts from china causes in us gdp.?
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</span>When a U.S. company purchases and imports electronic parts from China to use to produce MP3players within the United States, this purchase increases the investment component of GDPwhile also decreasing net exports by the same amount. Therefore, the purchase of electronic parts from China causes no overall change in<span> US GDP.
The investment components of GDP will increase if anyone from the country will purchase goods and services from another country. In the above scenario, since US purchase electronic parts from China then the investment component will increase, then the net import will decrease by the same amount. In other words, the purchase of a product from another country will affect us. </span><span> </span>
Systemic risk occurs when there is a possibility that a company or a sector of the economy may go into crisis and negatively influence the entire economy of a country. They can happen in companies that are extremely relevant to the economy and would influence in many other sectors causing economic crisis
