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Choose ONE of the following (A., B., or C.: answer only ONE. If more than one short-answer question is answered, only the FIRST will be graded). The quality of your answer will determine your grade: A.Suppose the economy is in short-run equilibrium. Use the AD-AS model to predict short-run changes to real GDP and the aggregate price level if the U.S. stock market has a prolonged decrease in shareholder value. Explain your reasoning. B. What is the goal of contractionary monetary policy, and how does it work in the short run? C. Suppose the economy is significantly weakened, real GDP is far below potential GDP, and the unemployment rate is high. The Federal Reserve is concerned that monetary policy might have limited effectiveness due to deflation. How can deflation limit the Fed's ability to increase aggregate demand