If the Shifts in AD That Will Result from Policy

Multiple Choice

If the shifts in AD that will result from policy changes are fully and accurately anticipated, an increase in government purchases or a decrease in taxes would result in which of the following in the short run?

A) ​a higher level of real output and a higher price level
B) ​a higher level of real output but no change in the price level
C) ​a higher price level and a reduced level of real output
D) ​a higher price level but no change in real output