In Shoetown,a rancher takes $0 worth of inputs and produces animal skins,which he sells to the tanner for $400.The tanner then sells leather to the shoemaker for $700,and the shoemaker then sells $1200 worth of shoes.The value added by the tanner is

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Quizplus · Accepted Answer

The value added by the tanner is calculated by taking the revenue generated from selling the leather to the shoemaker ($700) and subtracting the cost of the animal skins purchased from the rancher ($400). Therefore, the value added by the tanner is $700 - $400 = $300.

In Shoetown,a Rancher Takes $0 Worth of Inputs and Produces