fbpx

Static GE Equilibrium and Welfare Gain Exercise | Online Assignment Help

For exercises 1-3, use the benchmark model in class where the government taxes household

Don't use plagiarized sources. Get Your Assignment on
Static GE Equilibrium and Welfare Gain Exercise | Online Assignment Help
Just from $13/Page
Order Now

labor income and lump sum transfers it back to them.

Exercise 1: What if we were Italian? Calibrate α so as to match the average work week for Italia

for the 1970-74 period as reported in Table 2 in Prescott (2004).

Exercise 2: (Laffer Curve) Use Excel to show how the equilibrium varies with the tax rate given

the value for  from Exercise 1 above. Vary  in steps of 0.01 from 0.00 to 1.00. Plot

c, h, and tax revenue variables, hw versus  .

Exercise 3: Determine the welfare gain associated with lowering the tax rate in Europe from 0.60

to the U.S. tax rate of 0.40.

(Recall, the welfare gain in lifetime consumption equivalents of changing the tax rate from the

current U.S. rate of 0.40 to the European rate of 0.60 is the value of  such that

 

Therefore, (1+) is the factor that consumption must be scaled if there is a change in the tax rate

from 40% to 60% to leave people indifferent to the change. The welfare loss in consumption

equivalents is c . In effect, find the values of . and ),60.0( ),60.0( ),40.0( hcc

Exercise 4.

Consider the model economy with an alternative government policy. The commodities are labor

h and consumption c. The price of c is normalized to 1. The price of labor is the wage rate w.

A household’s problem is to maximize utility

)100ln(ln sd hc 

subject to its budget constraint  sd whc , where  is a lump sum transfer from the

government. Here the superscripts s and d indicate supply and demand

A firm’s problem is to maximize profits dd whhA  )1(  . Notice that the government

imposes a tax on the firm’s output or sales.

The government’s budget constraint is dAh  .

The consumption and labor markets clear which means that ccc ds  and hhh ds  .

Find the equilibrium for this economy; that is equilibrium ( , , , )c h w as a function of utility

function parameter  and tax policy parameter  . Note set the TFP parameter A=1

Calculate your paper price
Pages (550 words)
Approximate price: -

Why Choose Us

Quality Papers

At Myhomeworkwriters.com, we always aim at 100% customer satisfaction. As such, we never compromise o the quality of our homework services. Our homework helpers ensure that they craft each paper carefully to match the requirements of the instruction form.

Professional Academic Writers

With Myhomeworkwriters.com, every student is guaranteed high-quality, professionally written papers. We ensure that we hire individuals with high academic qualifications who can maintain our quality policy. These writers undergo further training to sharpen their writing skills, making them more competent in writing academic papers.

Affordable Prices

Our company maintains a fair pricing system for all academic writing services to ensure affordability. Our pricing system generates quotations based on the properties of individual papers.

On-Time delivery

My Homework Writers guarantees all students of swift delivery of papers. We understand that time is an essential factor in the academic world. Therefore, we ensure that we deliver the paper on or before the agreed date to give students ample time for reviewing.

100% Originality

Myhomeworkwriters.com maintains a zero-plagiarism policy in all papers. As such, My Homework Writers professional academic writers ensure that they use the students’ instructions to deliver plagiarism-free papers. We are very keen on avoiding any chance of similarities with previous papers.

Customer Support 24/7

Our customer support works around the clock to provide students with assistance or guidance at any time of the day. Students can always communicate with us through our live chat system or our email and receive instant responses. Feel free to contact us via the Chat window or support email: support@myhomeworkwriters.com.

Try it now!

Calculate the price of your order

You will get a personal manager and a discount.
We'll send you the first draft for approval by at
Total price:
$0.00

How it works?

Follow these simple steps to get your paper done

Place your order

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Homework Writing Services

My Homework Writers holds a reputation for being a platform that provides high-quality homework writing services. All you need to do is provide us with all the necessary requirements of the paper and wait for quality results.

Essays

Essay Writing Services

At My Homework Writers, we have highly qualified academic gurus who will offer great assistance towards completing your essays. Our homework writing service providers are well-versed with all the aspects of developing high-quality and relevant essays.

Admissions

Admission and Business Papers

With Myhomeworkwriters.com, we will help you secure a position at your desired institution. Our essay writing services include the crafting of admissions papers. We will still help you climb your career ladder by helping you write the official papers that will help you secure a job. We will guide you on how to write an outstanding portfolio or resume.

Editing

Editing and Proofreading

Myhomeworkwriters.com has a professional editorial team that will help you organize your paper, paraphrase it, and eliminate any possible mistakes. Also, we will help you check on plagiarism to ensure that your final paper posses quality and originality.

Coursework

Technical papers

My Homework Writers harbors professional academic writers from diverse academic disciplines. As such, we can develop homework writing services in all academic areas. The simplicity or complexity of the paper does not affect the quality of homework writing services.