If the Bank of Canada Adopts Stronger Anti-Inflation Policy (For

Multiple Choice

If the Bank of Canada adopts stronger anti-inflation policy (for example,by lowering its inflation target) ,

A) in the short run,the IA curve will shift downward and a recessionary gap is created.
B) in the long run,the ADI curve will shift to the left and the long-run equilibrium is restored.
C) in the short run,the ADI curve will shift to the right and an expansionary gap will be created.
D) in the short run,the ADI curve shifts to the left and a recessionary gap is created.
E) in the short run,the ADI curve shifts to the right and a recessionary gap is created.