1.Assume that there are five firms in an economy: a steel producer, a rubber producer, machine tool producer, tire producer, and bicycle producer. In producing the bicycle, bicycle producer buys tires from the tire producer (1000$), steel form the steel producer (2500$) and tools from the machine tool producer (1800$). Also, the tire producer buys rubber from the rubber producer (600$) and machine tool producer buys steel from the steel producer (1000$). The bicycle producer sells his bicycles to the final consumer for 8000$.

a.Calculate GDP in terms of value added. Show your calculations.

b.Calculate GDP in terms of final expenditures. Show your calculations.