Assume an economy where there are two producers: a wheat producer and a bread producer. In a given year, the wheat producer grows 3 million tonnes of wheat, of which 2.5 million tonnes are sold to the bread producer at $30 per bushel, and 0.5 million tonnes are stored by the wheat producer to use as seed for next years crop. The bread producer produces and sells 100 million loaves of bread to consumers for $3.50 per loaf. Determine GDP in this economy during this year using the product and expenditure approaches.
Assume an economy where there are two producers: a wheat producer and a bread producer. In a given year, the wheat producer grows 3 million tonnes of wheat, of which 2.5 million tonnes are sold to the bread producer at $30 per bushel, and 0.5 million tonnes are stored by the wheat producer to use as seed for next years crop. The bread producer produces and sells 100 million loaves of bread to consumers for $3.50 per loaf. Determine GDP in this economy during this year using the product and expenditure approaches.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Assume an economy where there are two producers: a wheat producer and a bread producer. In a
given year, the wheat producer grows 3 million tonnes of wheat, of which 2.5 million tonnes are
sold to the bread producer at $30 per bushel, and 0.5 million tonnes are stored by the wheat
producer to use as seed for next years crop. The bread producer produces and sells 100 million
loaves of bread to consumers for $3.50 per loaf. Determine
using the product and expenditure approaches.
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