What Is the Relationship Between Net Exports, the Government Sector

question 437

Essay

What is the relationship between net exports, the government sector surplus or deficit, and the private sector surplus or deficit?

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Definitions:

Output

The aggregate output of merchandise or services generated by a company, sector, or economic system.

Production Function

A mathematical model describing the relationship between the inputs used in production and the resulting output of goods or services.

Returns To Scale

The change in output as a result of a proportional change in all input factors in the production process.

Marginal Product

The additional output resulting from the use of one more unit of a production factor, holding other factors constant.