Consider two individuals (a rich individual and a poor individual) and two types of goods: public goods and private goods. Explain the effects of proportional taxation assuming that the income effect of the poorer individual dominates the substitution effect with the help of a well-labelled diagram. Explain the effect of a lump-sum taxation on the individual’s choice of most preferred level of government expenditure with the help of a well-labelled diagram.
Consider two individuals (a rich individual and a poor individual) and two types of goods: public goods and private goods.
Explain the effects of proportional
Explain the effect of a lump-sum taxation on the individual’s choice of most preferred level of government expenditure with the help of a well-labelled diagram.
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Consider two individuals (a rich individual and a poor individual) and two types of goods: public goods and private goods
Explain the effect of a lump-sum
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