How is income determined in a model where there exists government expenditure, lump sum income taxes and transfer payments? Explain. Compare the model where there exists government expenditure,...

How is income determined in a model where there exists government expenditure, lump sum income taxes and

transfer payments? Explain.

Compare the model where there exists government expenditure, transfer payments and lump sum income tax with

one where there exists government expenditure, transfer payments and proportional income tax.