Answer: a. Decrease in Net Exports
b. Increase in Net Capital
c. Decrease in Net Capital.
d. Increase in Net Exports
Explanation:
a. A Decrease in Net Exports
Net Exports is Exports - Imports. In buying a Television from a foreign company, the American has imported the good. This will reduce Net Exports by the aforementioned formula.
b. An INCREASE in NET CAPITAL OUTFLOW
This is essentially Capital being invested in other countries. It increases when more is invested in other countries as opposed to less.
c. A DECREASE in NET CAPITAL OUTFLOW.
As previously stated, Net Capital Outflow increases when a country invests more in another country. Since we are looking at it from the perspective of the USA, Sony, which is not an American company, buying into such capital is considered a Decrease in Net Capital Outflow as money is coming into the US.
d. An INCREASE in NET EXPORTS
Here, a foreigner is buying goods in the USA. That translates to Export. And by the Net Export Equation, Net Exports will rise.
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