Suppose there are only two firms in an economy: Rolling Rawhide produces rawhide and sells it to Chewy Chomp, Inc, which uses the rawhide to produce and sell dog chews. With each $1 worth of rawhide that it buys from Rolling Rawhide, Chewy Chomp, Inc produces a dog chew and sells it for $2.50 . Neither firm had any inventory at the beginning of 2014 . During that year, Rolling Rawhide produced
enough rawhide for 2000 dog chews. Chewy Chomp, Inc bought 90% of that rawhide for $1800 and promised to buy the remaining 10% for $200 in 2015 . Chewy Chomp, Inc produced 1800 dog chews during 2014 and sold each one during that year for $2.50 . What was the economy's GDP for 2014?
a. $3,800
b. $4,500
c. $4,700
d. $5,000
c
You might also like to view...
The above figure illustrates the market for electric power that is served by the one utility in Alberta, Canada
a. If the government did not regulate this utility, what would be the price of a kilowatt hour in this region and how much power would be generated? b. If the government regulates the utility and chooses an average cost pricing rule, what would be the price of a kilowatt hour and how much power would be generated? c. If the government regulates the utility and chooses a marginal cost pricing rule, what would be the price of a kilowatt hour and how much power would be generated?
What is the best response of Vendor B to Vendor A pricing high?
a. Also price high b. Price low c. Leave the market d. All of the above
Which of the following taxes is not collected from the consumer on the final sale of goods and services?
a. consumption tax b. national sales tax c. value-added tax d. flat tax
Payments made to individuals for which goods or services are exchanged are known as ______.
a. co-pays b. deductibles c. transfer payments d. taxes