Final answer:
In the neoclassical view, an anticipated decrease in the money supply causes the price level to decrease while output remains unchanged in the short run, reflecting answer choice B: remain unchanged; decrease.
Step-by-step explanation:
In the extended classical model of economics, particularly the neoclassical perspective, the primary effect of a change in monetary policy is on the price level, while the level of output remains unchanged in the long run. When there is an anticipated decrease in the money supply, we expect the short-run effects to be a decrease in the price level. This is because the neoclassical view holds that in the long run, output is determined by the potential GDP, which is unaffected by shifts in aggregate demand caused by monetary policy changes.
Therefore, the correct answer to the student's question is: In the extended classical model, an anticipated decrease in the money supply would cause output to remain unchanged; and the price level to decrease in the short run. This corresponds to choice B: remain unchanged; decrease.