Use the Following to Answer Questions

Multiple Choice

Use the following to answer questions :
Figure: Short- and Long-Run Equilibrium
-(Figure: Short- and Long-Run Equilibrium) Look at the figure Short- and Long-Run Equilibrium. The government should _____ aggregate demand by _____ taxes to close the _____ gap.

A) expand; increasing; inflationary
B) reduce; cutting; inflationary
C) expand; cutting; recessionary
D) reduce; increasing; recessionary