Use the Following to Answer Questions

Use the following to answer questions :
Figure: Monetary Policy I
-(Figure: Monetary Policy I) Look at the figure Monetary Policy I. If the economy is initially in equilibrium at E₁ and the central bank chooses to buy Treasury bills, _____ shift to _____ a(n) _____ gap.

A) AD₁ may; AD₂, closing; recessionary
B) AD₁ will; left, increasing; recessionary
C) SRAS₁ will immediately; left, closing; inflationary
D) SRAS₂ will immediately; right, increasing; inflationary

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