Table 6-6 Shows the Different Stages in the Production of an Office

Multiple Choice

Table 6-6 shows the different stages in the production of an office building. A mining firm extracts iron from the earth. A steel mill converts the iron to steel beams for use in construction. A construction company uses the steel beams to make a building. Assume that the total product of these firms represents the only components of the building and that they will have no other uses.
Table 6-6

-Refer to Table 6-6. Suppose the value-added tax is 10%. What is the amount paid by Crane Construction to Fuller Mill?

A) $825,000
B) $725,000
C) $247,500
D) $225,000