Question

On the basis of the following data about an economy which consists of only two firms, find out the value added by firm A. $\begin{array}{cc}\text{Items}& \left(\text{in lakh}\right)\\ \text{Sales by firm A}& 100\\ \text{Purchases from firm B by firm A}& 40\\ \text{Purchases from firm A by firm B}& 60\\ \text{Sales by firm B}& 200\\ \text{Closing stock of firm A}& 20\\ \text{Closing stock of firm B}& 35\\ \text{Opening stock of firm A}& 25\\ \text{Opening stock of firm B}& 45\end{array}$

• A. 35
• B. 55
• C. 85
• D. 195

Answer 1

The correct option is B

55

Value added by firm A = Sales by firm A-Purchases from firm B by firm A+ (Closing stock of firm A- Opening stock of firm A) = 100 - 40 + (20-25) = 55 lakh rupees