Assume the Economy Is at Full Employment

Assume the economy is at full employment.Which is the most likely effect of a decrease in government spending?

A) output, prices, and interest rates will all increase in the medium run
B) output, prices, and interest rates will all decrease in the long run
C) prices and interest rates will decrease in the medium and long run while output will be negatively affected in the medium run but not in the long run
D) output and prices will remain the same in the long run, but interest rates will increase both in the medium and long run
E) output, prices and interest rates will all decline in the medium run but only output will be negatively affected in the long run