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Question 3 9 pts I) In the accompanying figure, explain what happens to 1) inventory levels, 2) production, and 3) Real GDP if: (a) The
Question 3 9 pts I) In the accompanying figure, explain what happens to 1) inventory levels, 2) production, and 3) Real GDP if: (a) The economy is at Q1; (b) The economy is at Q2- II) If Natural Real GDP is Q2, in what state (recession, boom, full employment) is the economy at point A? 45 Line B TE = C+1+G A D TP, TE C E Q1 Q3 Q2 Real GDPQuestion 4 6 pts Explain how, under certain conditions, expansionary fiscal policy can destabilize the economy.Question 5 5 pts Based on Keynesian macroeconomic model, explain why the economy is unable to self-adjust out of a recession to full employment
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