Problems 15 - 20 pertain to the following input-output model: Assume that an economy is based on three industrial sectors: agriculture A , building B . and energy E .The technology matrix M and final demand matrices (in billions of dollars) are A B E A B E 0.3 0.2 0.2 0.1 0.1 0.1 0.2 0.1 0.1 = M D 1 = 5 10 15 D 2 = 20 15 10 How much of each of A ’s output dollars is required as input for each of the three sectors?
Problems 15 - 20 pertain to the following input-output model: Assume that an economy is based on three industrial sectors: agriculture A , building B . and energy E .The technology matrix M and final demand matrices (in billions of dollars) are A B E A B E 0.3 0.2 0.2 0.1 0.1 0.1 0.2 0.1 0.1 = M D 1 = 5 10 15 D 2 = 20 15 10 How much of each of A ’s output dollars is required as input for each of the three sectors?
Solution Summary: The author explains the technology matrix M, demand matrices D_1 and
Problems
15
-
20
pertain to the following input-output model: Assume that an economy is based on three industrial sectors: agriculture
A
, building
B
. and energy
E
.The technology matrix
M
and final demand matrices (in billions of dollars) are
A
B
E
A
B
E
0.3
0.2
0.2
0.1
0.1
0.1
0.2
0.1
0.1
=
M
D
1
=
5
10
15
D
2
=
20
15
10
How much of each of
A
’s output dollars is required as input for each of the three sectors?
(a) The following diagram shows the movement of Kenyan households among
three income groups: affluent, middle class, and poor, over the 11-year
period 1980–1991.
AFFLUENT
27.1%
Sh72,000
(in 1994)
7.5%
MIDDLE CLASS
8.5%
Sh24,000
(in 1994)
30.4%
POOR
(i)
Use the transitions shown in the diagram to construct a transition
matrix (assuming zero probabilities for the transitions between
affluent and poor).
(ii)
Assuming that the trend shown was to continue, what percent of
households' classified as affluent in 1980 -1991, were predicted to
become poor in 1993?
(iii)
According to the model, what percentage of all Kenyan households
will be in each income bracket in the long term?
1a. Given the Input - Output matrices and the final demands, find the value of total production for each of the industries:
Q.1 Suppose a simple economy with only an agriculture industry and a
steel industry with the following technology matrix. Find the gross
production of each industry if surpluses of 15 units of agriculture products
and 35 units of steel are desired.
A S
0.3 0.2 Agrikultwe
0.1 0.4] Steel
A =
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