You are given following information about four producers A, B, C and D in an economy. A sells ₹ 300 worth of his output to B, ₹ 200 worth of his output to C and ₹ 500 worth of output to households
You are given following information about four producers A, B, C and D in an economy. A sells ₹ 300 worth of his output to B, ₹ 200 worth of his output to C and ₹ 500 worth of output to households. The sales of B to A, C and D are worth ₹ 400, ₹ 200 and ₹ 300 respectively. C sells to A, B and D output worth ₹ 100 each. Sales by C to households are worth ₹ 900. D sells to households output worth ₹ 700. His exports are wroth ₹ 300 while stock worth ₹ 200 remains unsold with D. Estimate the value added by.
(i) A, B, C and D separately.
(ii) All of them together.
Ans.
(i) Value added: Firm A = ₹ 500; Firm B – ₹ 500; Firm C = ₹ 800; Firm B = ₹ 800; (ii) ₹ 2,600
Anurag Pathak Changed status to publish December 21, 2023
(i) Value Added by Firm A = Sales by Firm A to B + Sales by Firm A to C + Sales to Households – Purchase by Firm B – Purchase by Firm C
Value Added by Firm A = ₹ 300 + ₹ 200 + ₹ 500 – ₹ 400 – ₹ 100
Value Added by Firm A = ₹ 500
(ii) Value Added by Firm B = Sales by Firm B t0 A, C and D – Purchase from Firm A – Purchase from Firm C
Value Added by Firm B = ₹ 400 + ₹ 200 + ₹ 300 – ₹ 300 – ₹ 100
Value Added by Firm B = ₹ 500
(iii) Value Added by Firm C = Sales by Firm C to A, B and D + Sales by Firm C to households – Purchase from Firm A – Purchase from Firm B
Value Added by Firm C = ₹ 100 × 3 + ₹ 900 – ₹ 200 – ₹ 200
Value Added by Firm C = ₹ 800
(iv) Value Added by Firm D = Sales to Households + Exports + Unsold Stock – Purchase from Firm B – Purchase from Firm C
Value Added by Firm D = ₹ 700 + ₹ 300 + ₹ 200 – ₹ 300 – ₹ 100
Value Added by Firm D = ₹ 800
(v) Total Value Added = Value added by Firm A + Value Added by Firm B + Value Added by Firm C + Value Added by Firm D
Total Value Added = ₹500 + ₹ 500 + ₹ 800 + ₹ 800
Total Value Added = ₹ 2,600
Anurag Pathak Changed status to publish November 10, 2023
