Jill works for the Department of Tax Revenue

Subject:EconomicsPrice:2.86 Bought3

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Jill works for the Department of Tax Revenue. All the citizens who pay taxes to Jill's Department have the same utility function, U (x,y) = min{x,y}  and the same budget of $10.00. Good x has a per unit price of $0.95, whereas Good y has a per unit price of $1.00. Jill has estimated that imposing a tax of $0.10 per unit on Good x was raise $0.51 per citizen. Jill is mistaken. Calculate the difference in the actual amount of revenue per citizen that the tax will raise for the Department of Tax Revenue versus Jill's estimate. Note that the amount of revenue per citizen can be calculated as 0.10x* . Your answer should be in cents ($0.XX for example).