In the two-period model, suppose a household's income in the first period is $40,000, income in the second period is $50,000, and the real interest rate is 25 percent. The government proposes to give the household a tax rebate of $5,000 in the first period, but will tax the household an additional $5,0001.25=$6,250 in the second period. The household is under the government's tax rebate plan compared with before. better off worse off equally well off possibly better off and possibly worse off