A) Suppose the government raises taxes to reduce the budget decit while the central bank {RBA} pursues an expansionary monetary policy. What effect should this policy mix have on income and interest rate in the short run? illustrate your answerwith a graph. [5 marks]. Be sure to label: i. the axes: ii. the curves; iii. the initial equilibrium levels; iv. the direction the curves shift; and v. the new short-run equilibrium B} What is the effect of this policy mix on consumption and investment