a-us-company-exports-200000-worth-of-goods-to-japan-and-uses-the-proceeds-to-buy

Question

A US company exports $200,000 worth of goods to Japan and uses the proceeds to buy Japanese stocks. How does this illustrate the equality of net exports and net foreign investment?

Accepted Answer

Net exports increase by $200,000, and net foreign investment increases by $200,000, showing equality.

Answer

Net exports remain unchanged, and net foreign investment increases by $200,000.

Answer

Net exports decrease by $200,000, and net foreign investment decreases by $200,000, showing equality.

Answer

Net exports increase by $200,000, but net foreign investment remains unchanged.

A US company exports \$200,000 worth of goods to Japan and uses the proceeds to buy Japanese stocks. How does this illustrate the equality of net exports and net foreign investment?