please only do: if you can teach explain steps of how to solve each part how was formula retrieve? why? Utility from reporting full tax = (1-t)π why this U(w) = w Expected utility (from reporting less profit) what is this? = Auditable profit*(after-tax income with audit) + Auditable profit*(after-tax income without audit) Expected utility from reporting less profit = (π - tr - (t+f)(π-r)+(1-p)(π-tr) Utility from reporting full tax = (1-t)π p(π - tr - (t+f)(π-r)+(1-p)(π-tr) < (1-t)π pπ - ptr - p(t+f)(π-r)+(π-tr)-p(t+f)(π-r)+(π-tr)< π-p(t+f)(π-r)-tr < -tπ p*>t(π-r)/(t+f)(π-r) As a result, the value of p* should be at least equal to t/(t+f)
please only do: if you can teach explain steps of how to solve each part how was formula retrieve? why? Utility from reporting full tax = (1-t)π why this U(w) = w Expected utility (from reporting less profit) what is this? = Auditable profit*(after-tax income with audit) + Auditable profit*(after-tax income without audit) Expected utility from reporting less profit = (π - tr - (t+f)(π-r)+(1-p)(π-tr) Utility from reporting full tax = (1-t)π p(π - tr - (t+f)(π-r)+(1-p)(π-tr) < (1-t)π pπ - ptr - p(t+f)(π-r)+(π-tr)-p(t+f)(π-r)+(π-tr)< π-p(t+f)(π-r)-tr < -tπ p*>t(π-r)/(t+f)(π-r) As a result, the value of p* should be at least equal to t/(t+f)
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
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please only do: if you can teach explain steps of how to solve each part how was formula retrieve?
why? Utility from reporting full tax = (1-t)π
why this
U(w) = w
Expected utility (from reporting less profit) what is this? = Auditable profit*(after-tax income with audit) + Auditable profit*(after-tax income without audit)
Expected utility from reporting less profit = (π - tr - (t+f)(π-r)+(1-p)(π-tr)
Utility from reporting full tax = (1-t)π
p(π - tr - (t+f)(π-r)+(1-p)(π-tr) < (1-t)π
pπ - ptr - p(t+f)(π-r)+(π-tr)-p(t+f)(π-r)+(π-tr)< π-p(t+f)(π-r)-tr < -tπ
p*>t(π-r)/(t+f)(π-r)
As a result, the value of p* should be at least equal to t/(t+f)
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