If there is a deficit reduction,

a. the output level will decrease in the short-run, but will increase in the medium-run

b. the output level will increase in the short-run and the interest rate will increase in the medium-run

c. the output level will decrease in the short-run and the price level will decrease in the medium run

d. the output level will remain unchanged in the medium-run and the price level will rise in the medium-run