Study the below diagram and answer questions 31 and 32. 31. 32. Real interest rate, r Change in inflation rate Refer to the top figure in the diagram. An upward movement along the IS curve is the result of the decision taken by the 1. SARB to stimulate economic activity. 2. investors to reduce the output level. 3. SARB to decrease the policy rate in reaction to high inflation. 4. SARB to increase the interest in reaction to high inflation Refer to the bottom figure in the diagram. Which of the following options is/are correct about the medium-run equilibrium? a. The economy converges to the natural level of output and stable inflation. b. Over time there will be an upward movement along the IS curve from a to a1. 0. A decline in output moves the economy down the PC curve from a to a1. d. Policy rate = rn and output = Yn. e. There is no pressure on inflation at point a1. 1. a,b,c,dande 2. Only a, b, c and d 3. Only b, c and d 4. Only b, c, d and e 5. Not option 1, 2, 3 or 4