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Consider a national income model with the following consumption, investment, and tax functions C = 55 + 0.85YDT = 20 + 0.05YI = 10 + 0.1Y - 8r
where r is given as 6 % and G0 = 100.
(a) Find the equilibrium national income, consumption, investment, and tax.
(b) What is the numerical values of the multipliers?
(c) Is government budget in this economy balanced?
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