soln104

# soln104 - Problem Set #1 Solutions 1. First, fill out the...

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Problem Set #1 Solutions 1. First, fill out the gross production statements for the coal and steel producers. Gross Production Statement (Coal) Costs Receipts Raw Materials \$0m. Sales of Product \$75m. Wages \$50m. Inventory Change \$0m. Business Profits \$25m. Gross Value of Inputs \$75m. Gross Value of Output \$75m. Coal Producer’s GDP Costs Receipts Wages \$50m. Sales of Product - Raw Materials \$75m. Business Profits \$25m. Inventory Change \$0m. Value Added from Inputs \$75m. Value Added to Output \$75m. Gross Production Statement (Steel) Costs Receipts Raw Materials \$125m. Sales of Product \$200m. Wages \$40m. Inventory Change \$0m. Business Profits \$35m. Gross Value of Inputs \$200m. Gross Value of Output \$200

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Steel Producer’s GDP Costs Receipts Wages \$40m. Sales of Product - Raw Materials \$75m. Business Profits \$35m. Inventory Change \$0m. Value Added from Inputs \$75m. Value Added to Output \$75 a) (i) Product approach: Coal producer produces 15 million tons of coal at \$5/ton, which adds \$75 million to GDP. The steel producer produces \$10 million tons of
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## soln104 - Problem Set #1 Solutions 1. First, fill out the...

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