C Stony Brook University [US] httos:blackboard.stcybrook.edu/webaops/asse N h.js
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C Stony Brook University [US] httos:blackboard.stcybrook.edu/webaops/asse N h.jsp?course assessment id922331&course id 1170207 1&content id 4548756 18step-null !! Appa Naw f derm ca la da n. 1 1 bilion hace tu lf Ga don Ramsar a Amazon.com.cnást a Amazon.com Cag @ Trsadmil Wo k uta. G No Cat das tinatian. E> Tha To c Decar pr. " How to Gat Ricl cr um Ere t B tain what Consider an economy consisting of only two companies: Oil Inc. and Electricity Inc. Electricity Inc. buys $400 worth of oil from Oil Inc. and uses it to produce electricity. It is owned by US nationals, its plant is based in the US, and its workers are all US nationals. It receives $1000 in revenue from the sale of electricity to the public (domestic) and has to pay $500 in wages. Oil Inc. is awned by US nationals and it operates two different ail extraction plants, one at home and the other in Saudi Arabia. The domestic plant pays $400 in wages to domestic workers and produces $2000 worth of oil. Out of this production $1600 is sold directy to the public domestically and $400 is sold to Electricity Inc. The foreign plant employs only foreigners. Its total wage bill is $300. It produces $1300 worth of oil out of which $500 is sent back to the US and sold to the public and the remaining $800 is sold in Saudi Arabia. A·The value added by Electricity Inc. is 600 B. The value added by the domestic arm of Oil Inc. is 2000 C. US GDP is 2600 D. The value of US imports is 500 E. Consumption expenditure of the US economy is F US Corporate Profits equal G. Factor payments from abroad is H. National Income for the US economy is dollars. dollars. dollars. dollars. dollars. dollars. dollars. I. Assume for a moment that the foreign plant of Oil Inc. employs anly US nationals and the domestic plant employs only foreign nationals. The change in the value of US GDP as a result is J. Assume for a moment that the foreign plant of Oil Inc. employs only US nationals and the domestic plant employs only foreign nationals. US National Income would then be Click Save and Submit to save and submit. Click Save All Answers to save all answers Save All Answers Close Window Save and SubmitExplanation / Answer
A) The value added by Electricity Inc = Total output-total input
total output=total revenue and total input= wages+oil
So, 1000-(500+400) = $100
B) The value added by Domestic firm of oil Inc. = Total output-total input
2000-400 = $1600
C) US GDP = total output produced by both the firms plus net imports
So, US GDP = 1000+2000+500 = $3500
D) The value of US imports is equal to the amount sent by Oil Incorporation's foreign firm
= $500
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