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Suppose there are only two firms in the economy- 'Andy's Car manufacturer' (firm A) and 'Best auto parts' (firm B). Firm A buys parts worth
Suppose there are only two firms in the economy- 'Andy's Car manufacturer' (firm A) and 'Best auto parts' (firm B). Firm A buys parts worth $5000 from firm B. Firm A also pays its employees a total of $10,000 to build 100 computers, and pays $3000 in rent. Firm A is able to sell the 100 computers for $200 each. Show that the GDP using the expenditure method is the same as the GDP using the Value added/Production method. Please show your work clearly.
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