Question: Please help me with this question. #6. (10 marks) Provide short answers to the following questions. (a) True or false? The application of the GST

Please help me with this question.

Please help me with this question. #6. (10 marks) Provide short answers

#6. (10 marks) Provide short answers to the following questions. (a) True or false? The application of the GST after the excise tax to tobacco products sold in a monopoly market ensures that the maximum possible tax revenue is collected. Assume that both taxes affect the MR (not MC) for consistency. In your answer explain the difference with the application of the same taxes when their sequence is reversed. (b) A person is given a fixed benefit and the benefit is reduced for every dollar of wage income earned, with r being the rate of the benefit reduction. True or false? If there is a concern about the negative effect of the benefit on the person's work incentive, then its reduction rate r should not be 1 or close to 1. Graph the income-leisure budget line to explain your conclusion. Assume standard convex indifference curves with stronger preferences for leisure (over income) and ignore wage taxes

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