Reference no: EM131380776

Question 1

Consider the following economy consisting of 3 industry:

Energy		Farming		Candy
Total Sales	2400	Total Sales	2200	Total Sales	3000
Wages Paid	1400	Wages Paid	1200	Wages Paid	1200
Profits	800	Profits	400	Profits	600
Farming inputs	200	Energy inputs	600	Farming inputs	800
				Energy inputs	400

Calculate GDP using:

a. value of final good approach,
b. value added approach,
c. income approach.

Question 2

Consider an economy with three productive sectors: mining and farming; manufacturing; and retailing. Manufacturers produce goods each year with a sale value of 500. They sell 400 to retailers and 100 direct to the private sector and to government for consumption. Retailers buy goods for 400 from manufacturers and buy 50 from the agricultural sector. Retailers sell gods for consumption for 500. Manufacturers buy goods worth 200 from mining and agricultural rms. Farmers also sell 100 directly to the households for consumption.

What is the value added in each sector and what is the total output for the economy?

Question 3

How would you treat activities of criminals in GDP accounting? What about the activities of the police force?