Read this article from the conversation (click on the link): https://theconversation.com/grattan-on-friday-should-anthony-albanese-keep-his-word-on-the-stage-3-tax-cuts-189790

The equilibrium of the goods market is given by: Y =C+I+G.

Consider the following behavioural equations:

C = c0 + c1YD

T = t0 + t1Y YD =Y T.

Here,G and I are constant. Assume a closed economy and that 00,and t0 >0.

Based on the article from the conversation, if the stage-3 tax cut becomes effective, ceteris paribus, answer the following questions.

(a) How does it affect parameters c0, c1, t0, and t1?

(b) How does it affect T, YD, Y and C?

(c) Would the economy (Y ) then respond more or less to changes in au- tonomous spending? Explain.

(d) Based on your answer in part (c), how the effectiveness of the automatic stabiliser is affected by the stage-3 tax cut?