3. Consider an economic model with three industries: music, advertising and equipment. The model has Leontief...

 

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3. Consider an economic model with three industries: music, advertising and equipment. The model has Leontief input-output matrix 0.2 01 A= 0.1 0 0.2 0.2 0.1 0.3 (With the columns corresponding to the industries in the order listed). (a) If there is external demand for 1000 units from music, 500 units from advertising and 2000 units from equipment then calculate the total production required from each sector to meet this de- mand. (Note that you must show the matrix equation that you are solving, but calculations can be done using technology.) Give your answers rounded to the nearest unit. (b) How many units of production are used by each of the three industries to meet this demand? 4. Consider a two sector economy with input-output matrix A= ===== [0.4 0.5] [0.2 0.6] 1 (a) Are the sectors in the economy profitable? Give a reason for your answer. (b) Is the economy productive? Give a reason for your answer. 3. Consider an economic model with three industries: music, advertising and equipment. The model has Leontief input-output matrix 0.2 01 A= 0.1 0 0.2 0.2 0.1 0.3 (With the columns corresponding to the industries in the order listed). (a) If there is external demand for 1000 units from music, 500 units from advertising and 2000 units from equipment then calculate the total production required from each sector to meet this de- mand. (Note that you must show the matrix equation that you are solving, but calculations can be done using technology.) Give your answers rounded to the nearest unit. (b) How many units of production are used by each of the three industries to meet this demand? 4. Consider a two sector economy with input-output matrix A= ===== [0.4 0.5] [0.2 0.6] 1 (a) Are the sectors in the economy profitable? Give a reason for your answer. (b) Is the economy productive? Give a reason for your answer.