Answer:
1. a. The exports will rise by THB 80,000
As you are located in the US and have sold a product to a customer outside the US, this counts as an export resulting in a growth in US exports of THB 80,000.
b. There will be no imports.
You have not imported anything into the country from abroad.
c. Net exports will total THB 80,000
Net exports are deduced by subtracting imports from exports within a certain timeframe.
80,000 - 0
= THB 80,000
2. Due to the identity equation linked to net exports, the rise in U.S. net exports corresponds with an increase in U.S. net capital outflow.
Consequently, through exporting goods, funds from other nations flow into the US. This influx of capital bolsters the net capital outflow for the U.S.
3. a. You keep the Thai baht in your safety deposit box at home.
b. You invest in THB 48,000 worth of shares in a Thai company and THB 32,000 in Thai bonds.
c. You convert the THB 80,000 to dollars at your neighborhood bank, which then utilizes the foreign currency to buy stocks in a Thai corporation.
In the first case, the US is influenced since, although funds were received, they remain idle at home. In the other two instances, the money was not used to acquire items within the US but rather flowed back abroad. This indicates a capital outflow from the US which adversely impacts net capital outflow.
