Use the Following to Answer Questions

Multiple Choice

Use the following to answer questions:
Figure: AD-AS
-(Figure: AD-AS) Refer to Figure: AD-AS. Assume that the economy is in long-run equilibrium. If the Federal Reserve lowers the key interest rate:

A) the aggregate demand curve will shift to AD₂.
B) the aggregate demand curve will stay unchanged at AD₁.
C) there will be a downward movement along the aggregate demand curve AD₁.
D) the aggregate demand curve will shift to AD₃.