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Can I please have help with this homework question? thanks very much l. [lI marks]. Consider two countries that attract rms by engaging in tax

Can I please have help with this homework question? thanks very much

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l. [lI marks]. Consider two countries that attract rms by engaging in tax competition. The number of rms, mic, that moves to country It is: meHatk+ 1}, where ti. is a xed fee (a tax) imposed on each rm (independent of its prot} in cormtry k , ti is the corresponding fee (tax) of country j (i at It), [5' and tr are positive parameters, and k = 1,2. Suppose that each country rrmst provide certain services and amenities to a rm in its jurisdiction at cost of $c per rm. The fees (taxes) are also in dollars. Each country's objective is to maximize its total tax revenue (income from fees) not of costs. That it, it maximizes net tax revenue. Carerllv plot each country's best-response function on the same diagram with E1 on the vertical axis and t: on the horizontal axis and illustrate the Nash equilibrium taxes on your diagram. [Note: impose appropriate conditions on I9 and a to ensure that the equilibrium taxes are positive]

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