Figure: Monetary Policy IReference: Ref 15-12(Figure: Monetary Policy I) Refer to the information in the figure Monetary Policy I. If the money market is initially at E2 and the central bank chooses to sell bonds:Selected Answer: Answers: A. SRAS2 will shift immediately to the right, increasing an existing inflationary gap.AD2 may shift to AD1, creating a recessionary gap.C. AD2 will shift to the right, creating an inflationary gap.D. SRAS1 will shift immediately to the left, closing an existing inflationary gap.
Question 34 1 out of 1 points