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of labour input the government must dictate so as to achieve the governments objective and complete Column 3 of Table 2. Table 2: Government Output

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of labour input the government must dictate so as to achieve the governments objective and complete Column 3 of Table 2. Table 2: Government Output Stabilization By Order 1 2 3 Competitive Equilibrium Competitive Equilibrium Government Output Stabilization By Order z:zH:20 z:zL:15 :zL:15 1 Y 370.82 240.83 2 N 38.20 28.64 3 u: 4.85 4.20 4 11pr 4.85 4.20 5 APN 9.71 8.41 6 Household Utility 3216.02 3042.29 (2.D.) (10 points) Corr pare the values in Rows 2. 3, 5, and 6 in Column 2 with the values in Column 3 in Table 2 and provide economic intuition for the direction of the differences of the variables. Also. use calculations to show that the household is NOT consuming at the point Where their indifference curve is tangent to their overall constraint. (2.E.) (10 points) Draw a single schematic PPF and Household ConsumptionLeisure diagram to depict output. labour input, and household utility for each of the three scenarios depicted in the columns of Table 2

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