Table 3.4 of Godley/Lavoie

(1) Complete values for table if tax rate is 20%
(2) Complete values for table if tax rate is 30%
(3) Complete values for table in period 2 if tax rate is 30%


(1)

Y = G/(1-a1+a1θ) 38.5
T = θ *Y = 38.5*0.2 7.7
YD = Y - T = 38.5 - 7.7 30.8
C = a1*YD + a2*H-1 = 0.6*30.8 + 0.4*0 18.5
∆Hs = G - T = 20 - 7.7 12.3
∆Hh = YD - C = 30.8 - 18.5 12.3
H =∆Hh + H-1 = 12.3 + 0 12.3

(2)

Y = 34.48
T = 0.3*34.48 10.34
YD = 34.48 - 10.34 24.14
C = 0.6*24.14 + 0.4*0 14.48
∆Hs = 20 - 10.34 9.66
∆Hh = 24.14 - 14.5 9.66
H = 9.64 + 0 9.66


(3)

Y = 34.48 + a2*H-1 34.48 + 0.4*9.65 = 38.36
T = 0.3*38.36 = 11.5
YD = 38.36 - 11.5 = 26.86
C = 0.6*26.86 + 0.4*9.65 = 16.11 + 3.86 = 19.98
ChangeHs = 20 - 11.5 = 8.5
ChangeHh = 26.86 – 19.98 = 6.88
H = 6.88+ 9.65 = 16.53