1. Consider an economy with identical individuals. Each individual receives an income equal to w for each unit of labour, h, she provides. There is no other source of income. Each individual consumes n goods. Let p; denote the price of good i and x; the quantity that each person consumes. Use the budget constraint of the representative individual to show that a tax structure such that a set of taxes t; > 0 is levied on every good and th > 0 is levied on labour income (i.e. one in which all but leisure is taxed) is equivalent to an alternative one that involves t; > 0 for every good i and th labour income (i.e. one in which neither leisure nor labour are taxed). = 0 for

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