6. Consider a three-sector input-output model in which sector 1 is agriculture, sector 2 is manufacturing, and sector 3 is energy. Suppose that the input requirements are given by the following table: Units of agricultural goods Units of manufactured goods Units of energy output 1 unit of agricultural goods needs a 0.4 0.3 1 unit of manufacturing goods needs 0.2 0.1 0.2 1 unit of energy output needs 0.2 0.2 0.1 (where 0 < a < 1.) Now suppose that final demands for the three goods are 100, 80, and b units (b>0), respectively. If x1, x2, and x3 denote the number of units that have to be produced in the three sectors, a. Write down the Leontief equation system for the problem. b. What are the values of a and b that give the system unique solution.

6. Consider a three-sector input-output model in which sector 1 is agriculture, sector 2 is manufacturing, and sector 3 is energy. Suppose that the input requirements are given by the following table: Units of agricultural goods Units of manufactured goods Units of energy output 1 unit of agricultural goods needs a 0.4 0.3 1 unit of manufacturing goods needs 0.2 0.1 0.2 1 unit of energy output needs 0.2 0.2 0.1 (where 0 < a < 1.) Now suppose that final demands for the three goods are 100, 80, and b units (b>0), respectively. If x1, x2, and x3 denote the number of units that have to be produced in the three sectors, a. Write down the Leontief equation system for the problem. b. What are the values of a and b that give the system unique solution.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter13: General Equilibrium And Welfare

Section: Chapter Questions

Problem 13.3P

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