Eventually, we will return to the natural rate of output, and the LM will have moved back to its original level, with interest rates unchanged. This is why monetary policy is neutral in the medium run only prices change. If the growth of money has risen in the medium run, the underlying logic is the same, but the explanation is a bit different. To get full credit, either one of these explanations is acceptable, but you must have listed each of the steps given above. The reason the AS curve slopes upward is because higher output implies lower unemployment.
Lower unemployment means that workers have more bargaining power, etc.
Since the real wage is constant, higher nominal wages lead to higher prices. In order to receive full credit on this question, you needed to give complete explanations of the slopes, as above. Simply saying that P and Y were positively or negatively related is not an explanation. This happens automatically as bondholders sell domestic currency and reduce the money supply, or as the Central Bank contracts the money supply through OMOs. Reducing M shifts the LM curve to the left.