The pushing-on-a-string analogy makes the point that monetary policy may be better at
A) controlling demand-pull inﬂation than cost-push inﬂation.
B) pulling the aggregate demand curve leftward than pushing it rightward.
C) pulling the unemployment rate downward than pushing the economic growth rate upward.
D) keeping rapid inﬂation from occurring than reducing it once it has begun.

Question

Quizplus · Accepted Answer

The "pushing-on-a-string" analogy suggests that monetary policy is more effective at restraining or pulling back economic activity (such as reducing inflation or slowing down an overheated economy) than stimulating or pushing it forward (such as boosting demand or economic growth).

The Pushing-On-A-String Analogy Makes the Point That Monetary Policy May