lecture11 - Math 006 (Lecture 11) Leontief Input-Output...

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Unformatted text preview: Math 006 (Lecture 11) Leontief Input-Output Analysis Example 1. We have two industries, electric company E and water company W. Output for both companies is measured in dollars . The electric company uses both electricity and water (input) in the production of electricity (output), and the water company uses both electricity and water (input) in the production of water (output). Suppose that the production of each dollar’s worth of electricity requires $0.3 worth of electricity and $0.1 worth of water, and the production of each dollar’s worth of water requires $0.2 worth of electricity and $0.4 worth of water. If the final demand from the outside sector of the economy is $12 million for electricity and $8 million for water, how much electricity and water should be produced to meet this final demand? 1 Two-industry input-output analysis: Suppose that we have two industries, electric company E and water company W. Output for both companies is measured in dollars . The electric company uses both electricity....
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lecture11 - Math 006 (Lecture 11) Leontief Input-Output...

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