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ppcse that there are two types of comsumers in low mnrginal propensity to eonsume. eeono my. The second A higher mnrginal propensity to eonsume:
ppcse that there are two types of comsumers in low mnrginal propensity to eonsume. eeono my. The second A higher mnrginal propensity to eonsume: Suppcse that fraction, g, of the population are type I eolBumers and (I s) are type 2 The tax functions are: 1'2=t2Y Find the tax multiplier for each type of eonsumer_ I.e., find: Dt2 Comsider that less well off hotrseholds tend to have higher marginal propen- sity to eonsume than wealthier Furthermore, the shAre of wealthy howseholds Are very small. What do your results in the previous question sug- gest about the design of stimulus tax breaks during
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