Consider a simple two-sector economy containing manufacturing and agricultural industries. Manufacturing industry requires $20 million worth of its own product and $40 million worth of agricultural industry output in the process of supplying $75 million worth of its own product to final consumers. Similarly, agricultural industry requires $20 million worth of its own product and $20 million worth of manufacturing industry output in the process of supplying $20 million worth of its own product to final consumers. The primary suppliers provide inputs to manufacturing and agricultural industries worth $40 and $60 million, respectively and purchase the final outputs of $5 million. The initial sales/purchase is $30 million for manufacturing and $15 million for agriculture industry. Calculate: i. The direct and indirect sales. ii. Explain the total economic impact briefly.
Consider a simple two-sector economy containing manufacturing and agricultural industries. Manufacturing industry requires $20 million worth of its own product and $40 million worth of agricultural industry output in the process of supplying $75 million worth of its own product to final consumers. Similarly, agricultural industry requires $20 million worth of its own product and $20 million worth of manufacturing industry output in the process of supplying $20 million worth of its own product to final consumers. The primary suppliers provide inputs to manufacturing and agricultural industries worth $40 and $60 million, respectively and purchase the final outputs of $5 million. The initial sales/purchase is $30 million for manufacturing and $15 million for agriculture industry.
Calculate:
i. The direct and indirect sales.
ii. Explain the total economic impact briefly.
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