Please answer as best you as you can with full workings out please

2. Bequest Taxation: 40 points Consider a two period model: if = 0, 1. The parent lives in t = 0 and has endowment W > 0 and needs to decide how much to bequeath the kid. Denote bequest as b 2 O. The kid lives in period t = 1. There are no labor decisions taken in any period. The parent loves the kid and puts an altruistic weight of qr on the kid. The parent has utility wows), where 6 = 1 is the discount factor both the parent and the kid use. Suppose the interest rate is r = 0. President Selina Meyer is deciding whether to tax bequest with a bequest tax of I. Let 9 E [0, 1] denote weight Selina puts on the parent and 1 9 the kid, i.e., Selina's objective is to maximize 9[1n(cg)+ry1n(c{