Question 1: Suppose that all commodities, including leisure, are taxed at a rate of t = 43 percent. What is the equivalent value of the time endowment tax that is equivalent to the uniform commodity tax rate on all goods? a. 20 percent b. 25 percent c. 30 percent d. 35 percent e. 40 percent Question 2: Suppose the compensated demand elasticity for good x is ex = 0.45 and the compensated demand elasticity for y is e, = 0.15. Which of the following statements is true and why? a. The optimal commodity tax rate on good & should be 3 times lower than the optimal tax rate on good y. b. The optimal commodity tax rate on good x should be 3 times higher than the optimal tax rate on good y. c. Neither a. nor b. Question 3: Consider the following flat-rate income tax system: T(Y) = G + /Y a. Why is the marginal tax rate (MTR)? b. What is the average tax rate (ATR)? c. Is this tax system progressive? Explain why or why not