Suppose we have:

Y0 = 1000

Y1 = 1400

T0 = 200

T1 = 200

And the interest rate is 10%

1. If consumers have the following consumptionbehaviour, where C0 = 2*C1, how much will they consume in each period?
2. Suppose instead they live for a 3 periods and they earn Y2 = 400 and T2 = 0. What would their choices of C0, C1, and C2 be if they followed the rule C0 = 2*C1 and C1 = 2*C2? Would this be better or worse than if they paid no taxes at all in any of the three periods but had Y2 = 0 as a result. You don't need a Utility Function in this problem to answer.