Suppose the following model of govemment efficiency. Usity function over consumption of private goods (C) and public goods (G) is such that this country desires to have 2 units of consumption good per each unit of public good Exogenous Income: Y- 20 Lump-sum tax: T Govemment efficiency: a (This measures the number of public goods that can be produced from one unit of private consumption good) If the optimal lump-sum tax, T. that maximizes the representative consumer's utity and balance the govermment budget, is 10, then what is the value govemment efficiency. ? O A 1/3 OB 05 OC. 02 OD. 23 OE. none of the above

Suppose the following model of govemment efficiency. Usity function over consumption of private goods (C) and public goods (G) is such that this country desires to have 2 units of consumption good per each unit of public good Exogenous Income: Y- 20 Lump-sum tax: T Govemment efficiency: a (This measures the number of public goods that can be produced from one unit of private consumption good) If the optimal lump-sum tax, T. that maximizes the representative consumer's utity and balance the govermment budget, is 10, then what is the value govemment efficiency. ? O A 1/3 OB 05 OC. 02 OD. 23 OE. none of the above

Principles of Economics, 7th Edition (MindTap Course List)

7th Edition

ISBN:9781285165875

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter6: Supply, Demand And Government Policies

Section: Chapter Questions

Problem 5QR

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