X-M Law and Legal Definition
X-M is the abbreviation for net exports. It is the difference between exports of goods and services produced by the domestic economy and purchased by the foreign sector and imports ofgoods and services produced by the foreign sector and purchased by the domestic economy. While exports and imports are important, when combined into a single measure net exports captures the overall interaction between the foreign sector and the domestic economy. Arithmetically speaking, if exports exceed imports, then net exports are positive, and if imports exceed exports, the net exports are negative.