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A vertically integrated steel company owns and operates coal mines, iron ore mines, and a rail road system. Production of a $1 worth of steel requires inputs of $0.10 of steel, $0.05 of coal, $0.02 of iron ore, and $0.08 of rail road (trans- portation). Production of a $1 worth of coal requires $0.15 of steel, $0.10 of coal, and $0.03 of rail road. Production of $1 worth of iron ore requires $0.10 of steel, $0.12 of coal, and $0.02 of rail road. The input requirements for $1 worth of rail road are $0.35 of steel and $0.05 of coal.
(a) Determine the output of steel, coal, iron ore, and rail road companies needed to satisfy a final demand of $550 million of steel, $300 million of coal, $150 million of iron ore, and $120 million worth of rail road service.
(b) What is the value of coal and iron ore used in production of steel or sold in the market.
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