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3. If a rise in trade deficit results from a decrease in the quality of your country's products. a. How would this affect net exports
3. If a rise in trade deficit results from a decrease in the quality of your country's products.
a. How would this affect net exports at any given exchange rate?
b. Use a three-panel diagram to show the effect of this shift in net exports on the real exchange rate and trade balance.
c. Does a decline in the quality of your country's products have any effect on your standard of living? Give a clear elaboration with example or graphs or facts(Hint: When you sell goods to foreigners, what do you receive in return?)
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