If the Natural Rate of Unemployment Is 6%, but the Fed

Multiple Choice

If the natural rate of unemployment is 6%, but the Fed thinks it is 5% and attempts to use monetary policy to move unemployment from 6% to 5% then in the short run which of the following variables will the Fed's policy raise above their long-run levels?

A) the price level and real GDP
B) the price level but not real GDP
C) real GDP but not the price level
D) neither real GDP nor the price level