Monetary Policy in Highland

Multiple Choice

Monetary Policy in Highland
Highland has had inflation of 15% for many years. Highland establishes a new central bank, the Bank of Highland, with the hopes of reducing the inflation rate.
-Refer to Monetary Policy in Highland. The Bank of Highland publicizes that it intends to reduce the inflation rate to 5%. If Highlanders lower their inflation expectations, which curve shifts to the left?

A) both the short-run and the long-run Phillips curves
B) neither the short-run nor the long-run Phillips curves
C) only the short-run Phillips curve
D) only the long-run Phillips curve