The Short Run Sequence of Events Following an Unanticipated Shift

Multiple Choice

The short run sequence of events following an unanticipated shift to a more restrictive monetary policy would be

A) lower interest rates, decrease in aggregate demand, and a reduction in output.
B) lower interest rates, increase in aggregate demand, and an expansion in output.
C) higher interest rates, decrease in aggregate demand, and a reduction in output.
D) higher interest rates, increase in aggregate demand, and an expansion in output.