Economics Question Chrome File Edlt view Hstory Bookmarks People indow Help X /-

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Economics Question

Chrome File Edlt view Hstory Bookmarks People indow Help X /-Tace Test: Assignment 2--E ECramcs Question I creg9.x C | Stony Brook University(usi l https:blackboardst apcs New 1 lder 'mQ Can ow down. 5 billon hedge r ra don Ramsay p . A 20 noor rest. Amazon.com Colg Treadil workouts GMCC3st destination. The Toct Decay Pr "Ha bo Get Rid ct msBrex t Britain: What. Other eook marks " Consider an economy with orhy two busnesses cale Orange ric and uceInc. Orangen; owns ar a operates orange roves. t sels some o its oranges direct y o he pubiu ora total o $10,000. It sels th rest o its oranges to Juden: for $25,000. Juiceno uses the oranges it acquires to sell crange ce to the pubic. The total revenue af Jucere: ¡s S40,00. . The value of intermediate gaods for Juicelna i25 B. The value sdced by Orangelnc is 36 C. The value addec by Juicelre is 15 housar: dollars thousand dolera. thousand delkars QUESTION 2 80 points Save Answer Conaider an economy consistng of only two compenies: Oil ine, and Elactricty Inc. Electricity Inc, buys $400 worth of oil from Cil Inc, and uses it to procuca electricty. It is ownec by US nationals, ta plant is baaad in the Us, its workers are all U5 nationa receh es s 1000 in re erue from lhe s6le of electricity to lhe public domestici ard has to payS600 in wages. Oil Inc is owned by US nationals ard it operates two ciferent cil extraction plarts, one at home and the other in Seudi Aratia. The domestic clant peys 5400 in wages to domestic workers and procuces $2000 worth of ol. Out of this product on 51600 is solc directo the public domestically and S40ie eold to Electricity Inc. The 1oreian pat employe only foregners ns total wage bil is 300. It produces$ 1300 worth of oil out of which $500 e sert back to the US and Bold to the public and the remaina $800 is sole in Sauci Aratia. A. The value added by Electricty Inc. is 6C0 colars. B. The value adced by the demestic arm of Oil in. is2con C. US GDP is 2800 D. The value of US mpona is GD E. Consungtion expenciture of the US economy is F US Corporate Pratts eq1ual G. Facior payments from abro9d is H. Natonal Income far the US economy l. Assume icra mamant that the tregn part of di Inc.employs orly US natonals and the domestic part employs ony aregn nationals. The change In th valut! OuS GDP as a result s J, Assume for a momant that the 1ore gn pent of Oi Inc emcloys orly US nationals and the domestic pient employs ony fore gn nationals, US Natonal Income woud than be colars. colars. dallars. dolars. dollars. Click Sque and Submir to samve and suhnit. Chick Save AI Ansuers to save a answers Save AI Ariswers Close Window Save and Submit Harshay Park

Explanation / Answer

1. A) The value of intermediate good for Juiceinc is 25 thousands dollars , because Juiceinc buy $25000 worth of oranges from orangeinc and these oranges are used to produce juice which is the final product of Juiceinc.

B) The value added by orangeinc is = ( it's total revenue - input cost) = $(10000 + 25000) - 0 = $35000

C) The value added by Juiceinc is it's total revenue minus input cost = $(40000 - 25000) = $15000

D) GDP is value of final good = $(10000 + 40000 )= $50000

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