If the Bank of Canada Keeps the Real Interest Rate

Multiple Choice

If the Bank of Canada keeps the real interest rate constant,the recovery of a weak housing market would cause the ________,and the output gap would ________.

A) MP curve to shift up; become less negative
B) MP curve to shift down; become more negative
C) IS curve to shift to the left; become more negative
D) IS curve to shift to the right; become less negative