Please state which of the options is the correct answer and explain why this is. Additionally, please also explain why the other answers are incorrect.

(If the reasoning for the correct answer and incorrect answers are not adequately provided, your answer will be sent back to coursehero). Thank you.

Consider an economy described by the lSLMPC model. Suppose that expectations are anchored, and that initially it stays at the medium run equilibrium. lfthe central bank pursues macroeconomic stabilisation policies,which of the following developments will not prompt it to lower the policy rate? a. A drop in mark-ups; b. Inflation expectations' becoming unanchored; c. A drop in investor condence; d. An increase in wage sensitivity to unemployment