Starting from Short-Run Equilibrium,the Following Occurs: Personal Income Taxes Are

Multiple Choice

Starting from short-run equilibrium,the following occurs: personal income taxes are cut,business taxes are cut,and labor productivity rises.What is the effect on the price level and Real GDP in the short run?

A) Real GDP rises and the price level necessarily falls.
B) Real GDP rises and the price level necessarily rises.
C) Real GDP falls and the price level necessarily remains the same.
D) Real GDP rises and the effect on the price level cannot be determined.
E) Real GDP rises and the price level necessarily remains the same.