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NET EXPORTS LINE: The graphical depiction of the relation between net exports and national income (or gross domestic product) that plays a role in Keynesian economics and the Keynesian cross. The net exports line is derived by combining the exports line, relating exports and national income, with the imports line, relating imports and national income. Because exports are largely independent of national income and imports (which are subtracted from exports) increase with national income, the net exports line has a negative slope. The slope of the net exports line is thus the negative of the marginal propensity to import. The aggregate expenditures line used in the Keynesian cross is obtained by adding this net exports line, as well as, government purchases and net exports, to the consumption line. The government purchases line is also combined with investment expenditures for the Keynesian saving-investment model.
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                           VOLUNTARY EXCHANGE: The process of willingly trading one valuable commodity (good, service, or resource) for another. The key term is "willingly," which distinguishes voluntary exchanges from involuntary exchanges, such as those created by government taxes. Voluntary exchanges are the foundation of market transactions. Market transactions rely on voluntary exchanges. Buyers voluntarily trade money for a good and sellers voluntary trade a good for money. Neither buyers nor sellers are forced to engage in the exchange. They do so of their own free will.A Voluntary ExchangeSuppose, for example, that Edgar Millbottom, Shady Valley's resident teenage musical connoisseur, has come across a shoebox full of classic 8-track tapes, containing the memorable works of Englebert Humperdink, while rummaging through his attic. Because Edgar's musical tastes run more in the direction of rock groups like Live Headless Squirrels, he is willing and able to part with these 8-track treasures. A few phone calls, a newspaper ad, and some flyers at the mall, produce an interested party, Pollyanna Pumpernickel, who happens to be a die-hard Humperdink fan.Edgar and Pollyanna are prime candidates for a voluntary exchange; a voluntary exchange that is beneficial to both. Edgar gives up his dust-collecting shoebox of Humperdink 8-track tapes and receives a modest monetary payment. His living standard ratchets up a notch or two. Pollyanna also benefits from this exchange. She parts with a modest monetary payment and receives a treasured set of Englebert Humperdink 8-track tapes. Voluntary for BothThis voluntary exchange only happens if BOTH sides are agreeable. Should Edgar develop a liking for Humperdink music and is not willing to part with these items, then the exchange does not happen. If Pollyanna finds other uses for the modest monetary payment, such as repairing the hole in her roof created by an exploding hot water heater, then the exchange does not happen. Unless BOTH sides want the exchange, it does not happen.
Recommended Citation:VOLUNTARY EXCHANGE, AmosWEB Encyclonomic WEB*pedia, http://www.AmosWEB.com, AmosWEB LLC, 2000-2024. [Accessed: September 20, 2024].
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RED AGGRESSERINE
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Today, you are likely to spend a great deal of time calling an endless list of 800 numbers hoping to buy either a three-hole paper punch or decorative picture frames. Be on the lookout for fairy dust that tastes like salt.
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The wealthy industrialist, Andrew Carnegie, was once removed from a London tram because he lacked the money needed for the fare.
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"Man is born to live, not to prepare for life. " -- Boris Pasternak, writer
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