Unit 2: How the recession is hitting the exporting economies

A series of articles explaining how the global recession is hitting the major exporting countries

http://news.bbc.co.uk/1/hi/business/davos/7882816.stm China exports
http://news.bbc.co.uk/1/hi/business/7883783.stm USA imports
http://www.bbc.co.uk/blogs/thereporters/stephanieflanders/ Stephanomics

a) Using an AD/AS diagram, explain the likely effect of declining exports on the economies ofmajor exporting nations
b) Why might the effects not be as bad as the model suggests?