Question 3 {4 points]: Illustrate a permanent decrease in goverrmient spending (let's say infrastructure spending eeze) implemented in 2022. For simplicity, assume there are no time lags. a). [2 point}: To illustrate that shock, use AEIPC Model (carellly labeledii) without time lags (use the AE and PC graphs similarly to the textbook, place PC graph below AE graph). For your analysis, choose as a starting point (marked A) an economy operating at potential GDP (Y=Y*) and at its ination target (II = TIT). Also, show point B where the economy is situated after the shock but prior to any central bank policy response. There should be A and B on BOTH the upper (AE graph) and lower (PC graph) graphs. If points A and B are the same point, then just mark that point with both A and B. Mark initial curves with the superscript 1, like AE1 and PC}, and every subsequent shift with a higher number, like the second shift would be AE2 and PC2, and the third shift (if necessarily) would be A133 and PC3 and so on. b). [2 point): Now, illustrate that counter-cyclical monetary policy has been implemented by the central bank. Again, use AE/PC Model (new set of graphs!) Now your initial point is point B, mark the response as point C. There should be a points B and C on both the upper graph and the lower graph, even if they are in the same location. You can stop your analysis when the economy is stabilized (Y=Y* again)