- 7 Imagine There Were Only Two Consumers In The Economy A And B Who Earn Equal Share Of National Income But A Has A H 1 (18.8 KiB) Viewed 30 times
7. Imagine there were only two consumers in the economy, A and B, who earn equal share of national income, but A has a h
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7. Imagine there were only two consumers in the economy, A and B, who earn equal share of national income, but A has a h
7. Imagine there were only two consumers in the economy, A and B, who earn equal share of national income, but A has a higher marginal propensity to consume (you may assume linear consumption function for each consumer). If the government wanted to increase taxes, which consumer should it tax first? Prove using Keynesian-cross model.