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I use a 10 or 15 buck mic I bought from Radio Shack a good 5 or 6 years back. I use my randomly-found Philips speakers for sound.
I know radio shack sells a $15 cheap head set that my friends have had different experiences with with. I would say you are better off buying good headphones and a separate mic so that you can use them for things besides gaming without having to worry about the mic.
But I'm not a heavy gamer now-a-days since my computer is shit.
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