A company produces three products which are interdependent. These are products A, B and C. The flow of inputs and outputs between the products is represented in the table below. Inputs (in thousands of units) Final demand A B C Outputs (in thousands of units) A B C 80 120 160 130 260 130 150 150 50 40 120 160 Required: Derive the technical coefficients matrix. Determine the Leontief’s inverse matrix. Compute the output level for each product if the final demand for product A increased by 4000 units, that of product C decreased by 2,000 units and the final demand for product B remained unchanged.
A company produces three products which are interdependent. These are products A, B and C. The flow of inputs and outputs between the products is represented in the table below. Inputs (in thousands of units) Final demand A B C Outputs (in thousands of units) A B C 80 120 160 130 260 130 150 150 50 40 120 160 Required: Derive the technical coefficients matrix. Determine the Leontief’s inverse matrix. Compute the output level for each product if the final demand for product A increased by 4000 units, that of product C decreased by 2,000 units and the final demand for product B remained unchanged.
Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter7: Economies Of Scale And Scope
Section: Chapter Questions
Problem 5MC
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Question
- A company produces three products which are interdependent. These are products A, B and C. The flow of inputs and outputs between the products is represented in the table below.
|
|
Inputs (in thousands of units) |
Final demand |
||
|
|
A |
B |
C |
|
Outputs (in thousands of units) |
A B C |
80 120 160 |
130 260 130 |
150 150 50 |
40 120 160 |
Required:
- Derive the technical coefficients matrix.
- Determine the Leontief’s inverse matrix.
- Compute the output level for each product if the final demand for product A increased by 4000 units, that of product C decreased by 2,000 units and the final demand for product B remained unchanged.
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