An economy depends on two basic products, wheat and oil. To produce 1 metric ton

Question

An economy depends on two basic products, wheat and oil. To produce 1 metric ton of wheat requires 0.26 metric tons of wheat and 0.34 metric tons of oil. Production of 1 metric ton of oil consumes 0.08 metric tons of wheat and 0.14 metric tons of oil. Find the production that will satisfy a demand for 580 metric tons of wheat and 940 metric tons of oil.

Input-output matrix A=

How much wheat is required to satisfy the demand?

____ metric tons

(Round the final answer to the nearest whole number as needed. Round the elements of the inverse matrix to two decimal places as needed.)

Explanation / Answer

To produce 1 metric ton of wheat requires 0.26 metric tons of wheat and 0.34 metric tons of oil .

Production of 1 metric ton of oil consumes 0.08 metric tons of wheat and 0.14 metric tons of oil.

Demand for 580 metric tons of wheat and 940 metric tons of oil.

Wheat is required to satisfy the demand

= (0.26*580 + 0.08*940)

= 150.80 + 75.20   

= 226 metric tons required to satisfy the demand

Answer

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