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Use the Following to Answer Questions

Question 59

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Use the following to answer questions .
Exhibit: Stages in the Production of an Office Building
Use the following to answer questions . Exhibit: Stages in the Production of an Office Building -(Exhibit: 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. Suppose the value-added tax is 10%. What is the total VAT collected from all stages of production including final sale? A) $1,050,000 B) $127,500 C) $95,000 D) $72,500
-(Exhibit: 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. Suppose the value-added tax is 10%. What is the total VAT collected from all stages of production including final sale?


A) $1,050,000
B) $127,500
C) $95,000
D) $72,500

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