b. The government increases its purchases (spending) due to natural disasters. (See the set of graphs below and shifts in graphs.) POSITIVE Demand Shock Gov't corrective intervention SRAD1 SRADZ LRAS SRAS SRAD3 SRAD2 LRAS SRAS SRAD2 SRAD2 SRAS SRAD1 0 SRAS SRAD3 O Real GDP Real GDP 1) What kind of GAP exists (inflationary or recessionary)? N Which part of the FED's Congressional mandate (full employment or stable prices) does this situation trigger? 3) What kind of MONETARY policy might be helpful (increase or decrease money supply)? 4) What kind of FISCAL policy might be helpful (expansionary or contractionary)? 5) What specific FISCAL policy TOOLS can the government employ that would be helpful