Appendix questions:

a. Draw an indifference-curve/budget-line diagram to show the effect of removing a wage tax on labor supply. Directly below, draw another diagram that shows the ordinary labor supply curve and the compensated labor supply curve. Explain.

b. Draw an indifference-curve/budget-line diagram to show the effect of removing a tax on interest income on saving. Directly below, draw another diagram that shows the ordinary saving supply curve and the compensated saving supply curve. Explain.