An Expansionary Monetary Policy Is Most Likely to Produce an Inflationary

Multiple Choice

An expansionary monetary policy is most likely to produce an inflationary effect with little impact on output when the economy

A) is near full employment and the short-run aggregate supply curve is flat.
B) is near full employment and the short-run aggregate supply curve is steep.
C) has substantial unemployment and the short-run aggregate supply curve is steep.
D) has substantial unemployment and the short-run aggregate supply curve is flat.