Consider the diagram below which depicts a two-household community consisting of hOusehold A and household B. The quantity of public good is measured along the horizontal axis and the share of tax paid by HHA and HHB measures the share of tax paid by HHẠ and HHB.
Consider the diagram below which depicts a two-household community consisting of hOusehold A and household B. The quantity of public good is measured along the horizontal axis and the share of tax paid by HHA and HHB measures the share of tax paid by HHẠ and HHB.
Principles of Economics (MindTap Course List)
8th Edition
ISBN:9781305585126
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter12: The Design Of The Tax System
Section: Chapter Questions
Problem 4CQQ
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While the Lindahl model (equilibrium) can be analogous to the market for private goods, they have interesting differences. How do we interpret Q1 in the diagram? What about S?
![Consider the diagram below which depicts a two-household community
consisting of household A and household B. The quantity of public good is
measured along the horizontal axis and the share of tax paid by HHA and
HHB measures the share of tax paid by HHA and HHB.
100%
O'
A's share
of taxes
B's share
of taxes
DA
100%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc83fdb5f-0172-4e61-8d39-8bbc40a99aae%2Ff251b91b-f1b2-4201-8e91-bfeb739611c1%2F9uuybkt_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Consider the diagram below which depicts a two-household community
consisting of household A and household B. The quantity of public good is
measured along the horizontal axis and the share of tax paid by HHA and
HHB measures the share of tax paid by HHA and HHB.
100%
O'
A's share
of taxes
B's share
of taxes
DA
100%
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