How does export and imports impact GDP and unemployment within a local economy?

Question:

How does export and imports impact GDP and unemployment within a local economy?

What Is GDP:

The GDP metric stands for the Gross Domestic Product and is often the most scrutinized national economic metric by economists around the world. The GDP reflects the value of all goods and services produced in a country regardless of where they are sold.

Answer and Explanation:

See below.

Condition GDP Impact Unemployment Impact
Exports high Increases since more is produced internally. Decreases since higher production requirements mean that more workers are needed.
Exports low Decreases since less is produced internally. Increases since lower production requirements mean that fewer workers are needed.
Imports high Decreases since less is produced internally. Increases since lower production requirements mean that fewer workers are needed.
Imports low Increase since more is produced internally (i.e. to fulfill local demand). Decreases since higher production requirements mean that more workers are needed.

Learn more about this topic:

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Gross Domestic Product: How to Calculate Real GDP

from Economics 102: Macroeconomics

Chapter 5 / Lesson 6
90K

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