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The Leontief production equation, x = Cx + d, is usually

Linear Algebra and Its Applications | 5th Edition | ISBN: 9780321982384 | Authors: David C. Lay; Steven R. Lay; Judi J. McDonald ISBN: 9780321982384 49

Solution for problem 11E Chapter 2.6

Linear Algebra and Its Applications | 5th Edition

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Linear Algebra and Its Applications | 5th Edition | ISBN: 9780321982384 | Authors: David C. Lay; Steven R. Lay; Judi J. McDonald

Linear Algebra and Its Applications | 5th Edition

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Problem 11E

The Leontief production equation, x = Cx + d, is usually accompanied by a dual price equation, where p is a price vector whose entries list the price per unit for each sector’s output, and v is a value added vector whose entries list the value added per unit of output. (Value added includes wages, profit, depreciation, etc.) An important fact in economics is that the gross domestic product (GDP) can be expressed in two ways: Verify the second equality. [Hint: Compute pT x in two ways.]

Step-by-Step Solution:
Step 1 of 3

Solution 11ETo show that , note that the price equation is given by Take transpose on both sides gives Thus , multiply both sides from the right by x gives Hence …… (1).Also the Leontief production equation is , multiply this equation by from the left side gives Hence …… (2)From (1) and (2) Hence

Step 2 of 3

Chapter 2.6, Problem 11E is Solved
Step 3 of 3

Textbook: Linear Algebra and Its Applications
Edition: 5
Author: David C. Lay; Steven R. Lay; Judi J. McDonald
ISBN: 9780321982384

The answer to “The Leontief production equation, x = Cx + d, is usually accompanied by a dual price equation, where p is a price vector whose entries list the price per unit for each sector’s output, and v is a value added vector whose entries list the value added per unit of output. (Value added includes wages, profit, depreciation, etc.) An important fact in economics is that the gross domestic product (GDP) can be expressed in two ways: Verify the second equality. [Hint: Compute pT x in two ways.]” is broken down into a number of easy to follow steps, and 87 words. Linear Algebra and Its Applications was written by and is associated to the ISBN: 9780321982384. This full solution covers the following key subjects: price, added, whose, Vector, unit. This expansive textbook survival guide covers 65 chapters, and 1898 solutions. This textbook survival guide was created for the textbook: Linear Algebra and Its Applications , edition: 5. The full step-by-step solution to problem: 11E from chapter: 2.6 was answered by , our top Math solution expert on 07/20/17, 03:54AM. Since the solution to 11E from 2.6 chapter was answered, more than 260 students have viewed the full step-by-step answer.

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The Leontief production equation, x = Cx + d, is usually