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Assume a two-period model where national income is 140 in the current period and 50 in the future period. The world real interest rate is

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Assume a two-period model where national income is 140 in the current period and 50 in the future period. The world real interest rate is assumed to be 10% per period. The representative consumer always wishes to set current consumption plus government spending equal to future consumption plus government spending (C+ G = C' + G'), which implies perfect complements preferences.a. Determine consumption plus government spending in the current and future periods, and also the current account surplus. Draw a diagram to illustrate your results. Using the diagram to the right.

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