What are imports and exports?

Imports are the goods and services that are purchased from the rest of the world by a country’s residents, rather than buying domestically produced items. Imports lead to an outflow of funds from the country since import transactions involve payments to sellers residing in another country.

Why are exports and imports important for a country's economy?

can help you understand why they are crucial for a country's economy. Exports and imports are forms of trade involving the sales and purchase of goods or services in foreign countries. When a trader sells something outside their home country, it is an export, and when they purchase something from another country, it is an import.

What are net exports & total imports?

It is also known as National Income (Y). Total imports and total exports are essential components for the estimation of a country’s GDP. They are taken into account as “Net Exports”. (X-M) in the above equation represents net exports. Net exports are the estimation of the total value of a country’s exports minus the total value of its imports.

What does it mean if exports exceed imports?

When exports exceed imports, the net exports figure is positive. This indicates that a country has a trade surplus. When exports are less than imports, the net exports figure is negative. This indicates that the nation has a trade deficit. A trade surplus contributes to economic growth in a country.