Question

Opening Export Markets. Suppose a foreign country, which originally prevented the U.S. from exporting to them, opens their market and U.S. firms start to make a considerable volume of sales In this case, aggregate demand will:______

A. Increase because exports are directly related to shifts in aggregate demand.
B. Increase because exports are part of aggregate supply.
C. Decrease because exports are indirectly related to shifts in aggregate demand
D. Not change since consumption expenditures will fall by an equal amount

Answer 1

A. Increase because exports are directly related to shifts in aggregate demand.

Step-by-step explanation:

Aggegrate demand is the total amount of goods and services demanded in an economy at a given price during a particular period .

If import of US goods is now allowed, the aggregate demand would increase because of the demand for US goods. The aggregate demand curve would shift to the right.

I hope my answer helps you.