Question
Assume that the consumption function is given by C=200+ 0.7(Y-7), the tax function is given by T = 100+ t1Y, and Y = 50K0.5L0.5,
Assume that the consumption function is given by C=200+ 0.7(Y-7), the tax function is given by T = 100+ t1Y, and Y = 50K0.5L0.5, where K = 144. (1) If t = 10%, and L increases from 100 to 196, what is the effect on consumption level? (2) If L = 100, and ti increases from 10% to 11%, what is the effect on consumption level?
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Accounting for Governmental and Nonprofit Entities
Authors: Earl R. Wilson, Jacqueline L Reck, Susan C Kattelus
15th Edition
978-0256168723, 77388720, 256168725, 9780077388720, 978-007337960
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