Q. 1 In a hypothetical economy, only the following transactions take place. firm M sells all of
its product worth Rs. 12000 crores to firm N. Firm N sells its entire products to firm R for Rs.
19500 crores. Firm R sells his goods for final demand at Rs 27600 crore.
Now calculate the followings:
a) Value added by each firm.
b) An indirect tax of 12% is levied on N's product. the burden of this tax is shifted to
consumer. determine the market price of the goods for each firm.
c) A subsidy of Rs. 75 crores are given to firm M. As a result, it reduced the price of its
product. Determine the market price of output for all three firms.
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12th
Economics
National Income and Related Aggregates
Circular Flow of Income
In an economy, the followin...
ECONOMICS
In an economy, the following transactions take place and the final sale is for private consumption. A,B,C and D are four industries. A sells to B for Rs.20,000. B whose value added is Rs.40,000, sells half of Its output to C and another half to D. C sells all its output to D, whose value added is Rs.30,000. D sells all its output to final product for Rs.1,30,000. What is value added by C?
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