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Economics 12th Edition by William Baumol, Alan S Blinder
Edition 12ISBN: 978-0538453691Economics 12th Edition by William Baumol, Alan S Blinder
Edition 12ISBN: 978-0538453691 Exercise 4
The following outline provides a complete description of all economic activity in Trivialand for 2010. Draw up versions of Tables 3 and 4 for Trivialand showing GDP computed in two different ways. 10
i. There are thousands of farmers but only two big business firms in Trivialand: Specific Motors (an auto company) and Super Duper (a chain of food markets). There is no government and no depreciation
ii.Specific Motors produced 1,000 small cars, which it sold at $6,000 each, and 100 trucks, which it sold at $8,000 each. Consumers bought 800 of the cars, and the remaining 200 cars were exported to the United States. Super Duper bought all the trucks.
iii. Sales at Super Duper markets amounted to $14 million, all of it sold to consumers.
iv. All farmers in Trivialand are self-employed and sell all of their wares to Super Duper.
v. The costs incurred by all of Trivialand's businesses were as follows:
i. There are thousands of farmers but only two big business firms in Trivialand: Specific Motors (an auto company) and Super Duper (a chain of food markets). There is no government and no depreciation
ii.Specific Motors produced 1,000 small cars, which it sold at $6,000 each, and 100 trucks, which it sold at $8,000 each. Consumers bought 800 of the cars, and the remaining 200 cars were exported to the United States. Super Duper bought all the trucks.
iii. Sales at Super Duper markets amounted to $14 million, all of it sold to consumers.
iv. All farmers in Trivialand are self-employed and sell all of their wares to Super Duper.
v. The costs incurred by all of Trivialand's businesses were as follows:
Explanation
Verified
Verified
Computation of GDP Using Factor income
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Economics 12th Edition by William Baumol, Alan S Blinder
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