Consider a region with two main economies: M (machinery)
and S (service). From historical data, it is found out
that:
producing 1 unit of M requires 0.1 unit of M and,
0.2 unit of S;
producing 1 unit of S requires 0.1 unit of M and,
0.3 unit of S.
Suppose the total outside demands of M and S are 40 and
50 units, respectively. Determine the actual units of M
and S produced in order to satisfy the above demands.
Figure 1
A hand-drawn input-output flow diagram. Two
circled nodes are drawn side by side: node M
on the left, labeled underneath in red with
the variable \( x \), and node S on the
right, labeled underneath in red with the
variable \( y \). Node M has a curved
self-loop arrow above it labeled 0.1. Node S
has a curved self-loop arrow above it
labeled 0.3. A curved arrow runs from S
leftward to M, labeled 0.2 above it. A
second curved arrow runs from M rightward to
S, labeled 0.1 below it. An arrow points
from M outward to the left toward the number
40, and an arrow points from S outward to
the right toward the number 50, representing
the outside demands.
