29. The intersection of AD2and SRAS2indicate the initial conditions in the goods and services market with the current level of output, Y1, being the full employment level. The short- and long-run effects of the Fed shifting to a more expansionary monetary policy when it is fully anticipated will be:

a. short-run impact at the intersection of AD1and SRAS2; long-run impact, P1and Y₁.

b. short-run impact, P₁and Y₁; long-run impact, P₁and Y₁.

c. short-run impact, P₃and Y₁; long-run impact, P₁and Y₁.

d. short-run impact, P₃and Y₁; long-run impact, P₃and Y₁.

e. none of the above.

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