Falling Exports and Aggregate Demand. Suppose foreign countries grow less rapidly than anticipated and U.S. exports also fall. a. Using the income-expenditure model, first show how the decrease in...

Falling Exports and Aggregate Demand. Suppose foreign countries grow less rapidly than anticipated and U.S. exports also fall.

a. Using the income-expenditure model, first show how the decrease in exports will decrease U.S. GDP.

b. Using your results in part (a), explain how the aggregate demand curve shifts with the decrease in exports.