Homework 02_ Econ 104 WC Sec 1 Spring 2019_ATTEMPT 1.pdf

# Homework 02_ Econ 104 WC Sec 1 Spring 2019_ATTEMPT 1.pdf -...

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2/3/2019 Homework 02: Econ 104 WC Sec 1 Spring 2019 2/19 3 / 3 pts Question 1 Use the information below to answer questions 1-6 Consider an economy that produces only two goods: fresh apricots and dried apricots. In this economy, the technology of producing dried apricots is to place fresh apricots on special racks and allow them to dry in the sun. Fannie’s Farms is the only company that grows fresh apricots, while Darryl’s Dried Victuals is the only producer of dried apricots. Fannie’s sells some of its apricots directly to consumers for consumption. The relevant revenue and cost information for each of the two firms in the economy is given below: Darryl's Dried Victuals Revenue from selling dried apricots: \$2,750,000 Cost of buying fresh apricots from Fannie’s: 1,800,000 Interest on funds borrowed to buy drying racks: 200,000 Wages paid to employees 550,000 Taxes 90,000 Fannie’s Farms Revenue from selling fresh apricots: \$2,350,000 Rent on land (including apricot trees) 400,000 Wages to employees 1,100,000 Taxes 180,000 Darryl's profit from selling dried apricots is: \$5,390,000 \$150,000 None of these are correct
2/3/2019 Homework 02: Econ 104 WC Sec 1 Spring 2019 3/19 \$110,000 \$670,000 3 / 3 pts Question 2 Fannie’s profit from selling fresh apricots is: \$4,030,000 None of these are correct \$670,000 \$110,000 \$300,000 3 / 3 pts Question 3 Use the income approach to calculate nominal GDP. Fill in the blanks in the table below. Enter numbers with no commas, no dollar signs and no decimals. For example, if your answer is \$12,000 you would enter 12000 into the appropriate box. a. Total wages 1650000 b. Interest 200000 c. Rent 400000 d.Total profit* 780000

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• Inflation, Darryl, FANNIE

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