The following is background information about the country of Paraguay from Groliers' Encyclopedia. You will be using this information to solve a problem described after the article.
The Republic of Paraguay is a landlocked country of central South America, bordered by Argentina, Bolivia, and Brazil. Paraguay means "a place with a great river" in the Guarani Indian language, and most of its boundaries are marked by rivers. Primarily an agricultural country, Paraguay produces mainly livestock and cotton. The country gained independence from Spain in 1811, and much of its subsequent history has been dominated by wars.
ECONOMIC ACTIVITY
Agriculture, forestry, and fishing are historically the dominant economic activities in Paraguay. Although 27% of the total land area is arable, only 5% is used for crops; 80% of the agricultural land is owned by about 3% of the farmers. Cassava, maize (corn), sugarcane, tobacco, and rice are leading food crops, and livestock raising is the chief activity in the Chaco. Forest products include citrus, palm hearts, mate, and lumber. Paraguay's traditional exports, meat and lumber, have been adversely affected by trade restrictions; by 1986, cotton, vegetable oils, and soybeans provided nearly 45% of export revenues. Paraguay has no mineral fuels but has abundant hydroelectricity, which it exports. The country produced 1.15 billion kW of electricity in 1987. Paraguay's first steel plant, at Villa Hayes, was inaugurated in 1986.
In the late 1970s and early 1980s, construction of the giant Itaipu Dam on the Parana River, the world's largest hydroelectric installation, helped to give Paraguay the highest economic growth rate in Latin America. When construction ended, however, the rate of development and foreign investment in Paraguay slowed dramatically, despite the construction of another huge hydroelectric project on the Parana, Yaycreta Dam, which was expected to become operational in the mid-1990s. Factories built in the 1970s were operating far below capacity, and unemployment increased steadily in the 1980s.
LAND
Area: 406,752 sq km (157,042 sq mi).
Capital and largest city: Asuncion (1985 est. pop., 477,000).
Elevations: highest--Villarica Mountains, 700 m (2,297 ft.); lowest--46 m (150 ft), at the confluence of the Paraguay and Parana rivers.
ECONOMY
GDP (1991 est): $7.0 billion; $1,460 per capita.
Labor distribution (1986): agriculture--44%; industry and commerce--34%; services--18%; government--4%; urban unemployed--8%.
Foreign trade (1991): imports--$1.85 billion; exports--$642 million; principal trade partners--European Community, Brazil, United States, Argentina.
Currency: 1 guarani = 100 centimos.
GOVERNMENT
Type: republic.
Government leader (1993): Andres Rodriguez--president.
Legislature: National Congress.
Political subdivisions: 19 departments.
The economy of Paraguay consists of four basic sectors: agriculture, industry and commerce, services and government. Design a technology matrix for these sectors, and an external demand matrix based on $642 million in exports.
(1) Using your matrices, find the internal demand for each sector.
(2) Based on your matrices, what would change if the unemployment rate was 0%?