1.1 (111 points} What is the impact of a temporal-:5.F tax cut on current consumption according to: a. the Keynesian consumption function? Explain your answer briey. b. the permanent-income hypothesis? Explain your answer briey. 1.2 (10 points} Jack and Jill both chef,r the two-period Fisher model of consumption. Jack eams $100 in the rst period and $100 in the second period. Jill earns nothing in the rst period and $210 in the second period. Both of them can borrow or lend at the interest rate r. a. You observe both Jack and Jill consuming $100 in the rst period and $100 in the second period. 1What is the interest rate r? (Hint: write down the intertemporal budget constraint for Jack and Jill and check) h. Suppose the interest rate increases. \"Fhat will happen to Jack's consuruption in the first period? Is Jack better-off or worse off than before the interest rate rise? c. What will happen to Jill's consumption in the first period when the interest rate increases? ls Jill better off or worse off than before the interest rate increase