Use the Following to Answer Questions

Multiple Choice

Use the following to answer questions
Figure: Negative Supply Shock
-(Figure: Negative Supply Shock) Refer to the figure.This economy initially begins at point A and a negative supply shock takes it to point Y.If the Fed reacts by increasing money growth by 3%,this would take the economy to:

A) point A.
B) point B.
C) point X.
D) point V.