When a u. s. company purchases and imports automotive parts from canada to use to build cars within the united states, this purchase increases the component of gdp while also net exports by the same amount. therefore, the purchase of automotive parts from canada causes in us gdp.

By 2020, automobile market analysts expect that the demand for electric autos will increase as buyers become more familiar with the technology. however, the costs of producing electric autos may increase because of higher costs for inputs (e.g., rare earth elements), or they may decrease as the manufacturers learn better assembly methods (i.e., learning by doing). what is the expected impact of these changes on the equilibrium price and quantity for electric autos?