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There are four industries in the country of Kafiristan: stick-gathering, tomato-growing, basket-weaving and cutlery (knife-making). Tomatos and baskets are sold to households. Knives, which

 

There are four industries in the country of Kafiristan: stick-gathering, tomato-growing, basket-weaving and cutlery (knife-making). Tomatos and baskets are sold to households. Knives, which last a long time, are not sold to households; they are sold to tomato-farmers, basket-weavers and stick-gatherers, who all use knives in their businesses. Sticks, which are woven together to make baskets, are sold only to basket-weavers. Kafiris own land in the neighboring country of Kalashistan. Kalashis own all of the basket-weaving firms in Kafiristan. a) Fill out the missing items in the following table. Total revenue Cost of labor Cost of knives Cost of sticks Value-added Tomato farms 14 7 1 Stick-gathering 1 Basket-weaving 12 3 1 6. Cutlery 3 3 Profit of basketweaving firms: 2 Rent on land owned by Karifis in Kalashistan: 1 GDP of Kafiristan: GNP of Kafiristan: b) 5 pts. Which items' prices would be included in a CPI for Kafiristan? List the items: c) 5 pts. Which items' prices would be included in a GDP price index for Kafiristan? List the items:

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