Question
A large energy company produces electricity, natural gas, and oil. The production of a dollar's worth of electricity requires an input of $0.30 from electricity,
A large energy company produces electricity, natural gas, and oil. The production of a dollar's worth of electricity requires an input of $0.30 from electricity, $0.10 from natural gas, and $0.20 from oil. Production of a dollar's worth of natural gas requires an input of $0.30 from electricity, $0.10 from natural gas, and $0.20 from oil. Production of a dollar's worth of oil requires an input of $0.10 from each sector.
(a) what is the technology matrix M for this economy.
(b) if a final demand of $25 million for electricity, $15 million for gas, and $20 million for oil is to be met, then set up the equation to be satisfied by the inputs from the respective sectors.
(c) solve the respective inputs satisfying these demands.
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