2. Assume there exists two sectors in the economy, the public sector "government sector" (X) and private sector (Y). There is a fixed amount of capital that is shared between the two sectors. a. Draw the economy with both sectors below and the rate of return on capital that exists in the market. Why is "r" the same in both sectors? Explain. (4 points) b. If a tax is imposed on capital in the public sector "X", show the impact on the economy above in the long run. Label carefully (4 points) c. If instead, we are looking only at the short run (not the model above). Who bears the burden of the tax on capital in the public sector in the short run. Why? (4 points) 2. Assume there exists two sectors in the economy, the public sector "government sector" (X) and private sector (Y). There is a fixed amount of capital that is shared between the two sectors. a. Draw the economy with both sectors below and the rate of return on capital that exists in the market. Why is "r" the same in both sectors? Explain. (4 points) b. If a tax is imposed on capital in the public sector "X", show the impact on the economy above in the long run. Label carefully (4 points) c. If instead, we are looking only at the short run (not the model above). Who bears the burden of the tax on capital in the public sector in the short run. Why? (4 points)