If policymakers deem inflation as being too high, then the policy response should be monetary ________, which shifts aggregate demand ________.
A)tightening; right
B)tightening; left
C)easing; right
D)easing; a left

Question

Quizplus · Accepted Answer

In order for policymakers such as the Fed to reduce inflation, they must tighten monetary policy by shifting its policy reaction function upward, which shifts aggregate demand left.

If Policymakers Deem Inflation as Being Too High, Then the Policy