Final answer:
Net exports are the value of a country's exports minus its imports, affecting its GDP and indicating either a trade surplus or deficit.
Step-by-step explanation:
The net exports of a country are defined as the difference between the country's total value of exports and its total value of imports. This figure is part of the calculation of a country's Gross Domestic Product (GDP), indicating whether a country has a trade surplus or a trade deficit. If a country's exports exceed its imports, it is said to have a trade surplus, contributing positively to its GDP.
Conversely, when a country's imports surpass exports, it has a trade deficit, which subtracts from the GDP. The net export component, therefore, is an important indicator of a country's economic health within a global context and reflects the country's position in international trade.
For example, the United States had a period where exports typically exceeded imports in the 1960s and 1970s, reflecting a trade surplus. However, since the early 1980s, the U.S. experienced a shift, with imports generally exceeding exports, leading to a trade deficit.