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Jack and Jill live alone on an island. Their labour supply schedules are identical and given by L = (1 - t)w, where t is the income tax rate and w denotes the wage. Jill's wage is 6 and Jack's is 2. The tax paid by an individual is twL and each receives a transfer equal to half the total revenues. Jack and Jill have identical utility functions given by U =C - (1/2)L2, where C denotes consumption (the individual's income after tax and transfer). If the social welfare function is W = 3Ujack + UJill, what is the optimal tax rate?
[Hint: Write W as a function of the tax rate t.] Why is the optimal tax rate not 0? Why is it not 1?
Consider the model of industry protection of Grossman and Helpman. There are two industries A and B, each producing good X and Y respectively. All other things being equal, the dem
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need assignment on supply and money
QUESTION: a) How do returns to scale and returns to factor affect the shapes of the AC in the Long-run and short-run respectively? b) "Standard of living has to be measure
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Case for Improving upon the Market System Unlike the "optimistic followers" of the "classical school" who believed that markets would "natural!yn or "automatically" prod
how to make summarize the basic tenets of the arguments in the case of Mark Davis 2010 of journal of liberty?
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Quantitative policy process depends on a portfolio of tools that have been drawn from a variety of disciplines besides discretionary political decision. Over the past two decades
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