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Suppose the U.S. government proposes in a stimulus bill to provide US residents a debit card that each month will be loaded with $200 and
Suppose the U.S. government proposes in a stimulus bill to provide US residents a debit card that each month will be loaded with $200 and may only be used to purchase gasoline. The debit cards may not be sold or traded. On a graph, draw a typical resident's budget constraint before the bill passes Congress, with the two goods being gasoline and"all other goods."Next, draw the new income constraint after the bill has passed. Will all residents of the US be made better off by this proposed stimulus bill? Why or why not?
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