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A. Assume the following Keynesian Model of the economy C = 60 + 0.8QD QD = Q - T (taxes are levied in lump sums)

A. Assume the following Keynesian Model of the economy C = 60 + 0.8QD QD = Q - T (taxes are levied in lump sums) IP= 100; G = 200; T = 200

6. By this exercise, is deficit spending superior to spending under balanced budgets? Are income taxes superior to lump-sum taxes?

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