$(ILLUSTRATE$ and SOLVE FULLY$)$ Suppose that Wanda's income $is$ $$480(I_0=$$$480),$ the price $ofgdxis$ $$3(P_x^0=$$$3),$ and

the price $of$ good $Yis$ $$4(P_Y^0=$$$4).In$ order $to$ raise tax revenue and reduce the consumption $of$ good

$X,$ suppose that policymakers are considering two "equal$-cost"(equal$ revenue$)$ tax schemes $or$

policies: $a$ $$3$ excise tax $on$ good $X(ET)$; and, a lump sum income tax $(LSIT).$ Recall that "equal cost"

means that each tax scheme must generate the same revenue for the government $(i.e.,$ the amount $of$

tax paid $by$ Wanda $is$ the same under each tax scheme$).$ Wanda's preferences are represented $by$ the

indifference curves $in$ the graph below. Insert additional indifference curves $if$ needed.

$a{P}_x^0,P_y^0,$ and $I_0,$ Wanda's initial consumption bundle $is(x_0,y_0)=(80x,60Y)$ and her marginal

utility $of$ good $xis15$ utils and marginal utility $of$ good $Y{x}_0,Y_0\frac{?}{MU}{?}_{(}()()x)=15$ and

$\frac{?}{MU}{?}_{(}()()Y)=20.In$ the graph below, illustrate Wanda's budget line and initial consumption bundle

$(x_0,y_0)=(80x,60Y)x_0,y_0$ $$3t=$$$3\{$:$x_{ET},Y_{ET}),$ under the $$3x_{ET},V_{ET}{I}_T,of$ her income $I_0{x}_{ET},Y_{ET}\{$:$x_{\text{L}\text{S}\text{I}\text{T}},Y_{\text{L}\text{S}\text{I}\text{T}})x_{\text{L}\text{S}\text{I}\text{T}},Y_{\text{L}\text{I}\text{T}\text{T}}\{$:$x_{\text{E}\text{T}\text{I}\text{S}},Y_{\text{E}\text{T}\text{I}\text{S}})x_{\text{E}\text{T}\text{I}\text{S}},YETII{S}^{?}$ satisfies.

$ex$ and her happiness $(utility).$ Which policy $is$ best? Does any $of$ the policies

impose $an$ excess burden $(deadweight$ loss $or$ "loss $in$ efficiency"$)$ upon Wanda $or$ society? Explain.

How can this excess burden $or$ deadweight loss $be$ measured? Explain.