Answer
If $\theta$ is increased, then there is refraction of light into material 3.
Work Step by Step
If $\theta$ is increased, then the refracted angle in material 2 increases.
Note that the incident angle at the interface between material 2 and material 3 is $90^{\circ}-\theta_2$ where $\theta_2$ is the refracted angle in material 2.
If the refracted angle in material 2 increases, then the incident angle at the interface between materials 2 and 3 is decreased which would make the incident angle less than the critical angle.
In this case, there is refraction of light into material 3.
If $\theta$ is increased, then there is refraction of light into material 3.
