An economy consists of a silver mining company, a jewelry manufacturer, a jewelry retailer, and households/workers. The mining company pays its workers C=400,000 to mine 150kg of silver. The silver is then sold to the jewelry manufacturer for C=500,000 who pays its workers C=450,000 to make silver necklaces, which are sold to a retailer forC=1,200,000. The retailer sells the necklaces to consumers, and after paying sales staff C=100,000 makes a pro.t of C=200,000.
(a) Using the „production of final goods" approach, what is the GDP of this economy?
(b) What is the value added at each stage? Calculate GDP using the „value-added" approach.
(c) What are the wages and pro.ts earned by each sector? Calculate GDP using the income approach.