Asked by Delaney DeAvila on Apr 25, 2024
Verified
Explain the trade feedback effect.
Trade Feedback Effect
A phenomenon where an increase in exports leads to an increase in national income and thus an increase in imports.
- Evaluate the role and implications of trade agreements and global trade assemblies on the worldwide business environment.
Verified Answer
HC
Hayden Clearman8 days ago
Final Answer :
Increased demand for exports of other nations energizes their economic activity, resulting in higher national income, which stimulates their demand for imports. In short, imports affect exports and vice versa. This phenomenon is called the trade feedback effect and is one argument for free trade among nations.
Learning Objectives
- Evaluate the role and implications of trade agreements and global trade assemblies on the worldwide business environment.
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