A Simple Economy Consists of Two Industries: Agriculture and Manufacturing

question 4

Multiple Choice

A simple economy consists of two industries: agriculture and manufacturing. The production of 1 unit of agricultural products requires the consumption of 0.3 unit of agricultural products and 0.2 unit of manufactured goods. The production of 1 unit of manufactured products requires the consumption of 0.4 unit of agricultural products and 0.1 unit of manufactured goods. ​
Find the value of the goods consumed in the internal process of production needed to satisfy a consumer demand for $50 million worth of agricultural products and $300 million worth of manufactured products. Round answers to two decimal places.
​

• A) $243.92 million and $85.02 million worth of agricultural goods and manufactured products respectively
• B) $243.92 million and $100.00 million worth of agricultural goods and manufactured products respectively
• C) $250.00 million and $100.00 million worth of agricultural goods and manufactured products respectively
• D) $250.00 million and $85.02 million worth of agricultural goods and manufactured products respectively

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Definitions:

Approximate Price

An estimated cost given for a product or service, offering a ballpark figure that may not account for detailed specifics or potential changes.

Bundle

A marketing strategy that involves offering several products or services together as a combined package, usually at a lower price than they would cost individually.

Final Price

The total amount charged for a product or service, including all taxes, fees, discounts, and additional charges, at the point of sale.

Cost, Volume, Profit

An analysis tool used in managerial accounting to determine how changes in costs and sales volume affect a company's profit.