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Questions 1. -42 POINTS- Consider the following one-period model. Assume that the consumption good is produced by a linear technology: Y = 2ND where Y is the output of the con- sumption good, z is the exogenous total factor productivity, NP is the labour hours. Government has to finance its expenditures, G, using a lump-sum tax, T, on the rep- resentative consumer. There is no other tax in the economy. The firm is owned by the representative consumer who is endowed with h hours of time she can allocate between work, N'S and leisure, l. Preferences of the representative consumer are: U(c, 1) = alnc+ (1 -@) Inl (1) where 0