A consumer with utility function U = Y ½ has to choose between a job that provides income Y 0 but…
For the code described in the preceding problem, find the code words [T 1 ] and [T 2 ]…
August 8, 2017In a state-contingent income space, each person’s indifference curves are generally bowed in…
August 8, 2017A consumer with utility function U = Y ½ has to choose between a job that provides income Y 0 but…
A consumer with utility function U = Y½ has to choose between a job that provides income Y0 but no possibility of evading tax and a job that pays Y1 but makes evasion possible. What value of Y1 makes the consumer indifferent between these two jobs? How does a change in the tax rate affect this level of income?
