In exercise opportunity #6, we developed the following constraint environment for a consumer born in t and working in both periods of her life: WHEN YOUNG: Byx + 4+1 = (1-1) WHEN OLD: for+1 = R-1+1 + (1-1):+1) a. where as before t, denotes the labour income tax rate. Now let's suppose that residents in our economy have their consumption taxed at the flat rate to a national sales tax, if you will-instead of having their incomes taxed. Modify our resident's constraint environment to account for this new tax feature and then derive the resident's new lifetime budget constraint (LBC). b. You're a policy maker and you're thinking about replacing the income tax system with a national sales tax system (above) such that the new system raises the same amount of revenue as the old system. Given the result obtained in the sixth exercise opportunity, specifically the effect that an income tax has on lifetime earnings, determine what the flat rate sales tax would have to be if the flat rate income tax is currently 30% (0.3). In exercise opportunity #6, we developed the following constraint environment for a consumer born in t and working in both periods of her life: WHEN YOUNG: Byx + 4+1 = (1-1) WHEN OLD: for+1 = R-1+1 + (1-1):+1) a. where as before t, denotes the labour income tax rate. Now let's suppose that residents in our economy have their consumption taxed at the flat rate to a national sales tax, if you will-instead of having their incomes taxed. Modify our resident's constraint environment to account for this new tax feature and then derive the resident's new lifetime budget constraint (LBC). b. You're a policy maker and you're thinking about replacing the income tax system with a national sales tax system (above) such that the new system raises the same amount of revenue as the old system. Given the result obtained in the sixth exercise opportunity, specifically the effect that an income tax has on lifetime earnings, determine what the flat rate sales tax would have to be if the flat rate income tax is currently 30% (0.3)