Refer to the Diagram $A D _ { 1 }$ To $A D _ { 2 }$

Multiple Choice

Refer to the diagram. The real-business-cycle view of recession would best be described by

A) a decrease of aggregate demand from $A D _ { 1 }$ to $A D _ { 2 }$ , followed by a decrease in aggregate supply from $\mathrm { AS } _\mathrm { LR 1}$ to $\mathrm { AS } _\mathrm { LR 2}$ .
B) an increase in aggregate demand from $A D _ { 1 }$ to $A D _ { 2 }$ , which in turn causes a decrease in aggregate supply from $A S _ { \mathrm { LR } 1 }$ to $A S _ { \mathrm { LR } 2 }$ .
C) a decrease in aggregate supply from $\mathrm { AS } _ { \mathrm { LR } 1 }$ to $\mathrm { AS } _\mathrm { LR2 }$ , followed by a decrease in aggregate demand from $A D _ { 1 }$ to $A D _ { 2 }$ .
D) a decrease in aggregate supply from $\mathrm { AS } _ { \mathrm { LR } 1 }$ to $\mathrm { AS } _ { \mathrm { LR } 2 }$ , followed by an increase in aggregate demand from $A D _ { 2 }$ to $A D _ { 1 }$ .