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Tanner Whitman
on Nov 11, 2024

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Lags in the approval and implementation of fiscal policy:

A) weaken fiscal policy as a tool of economic stabilization.
B) increase the effectiveness of fiscal policy as a tool of economic stabilization.
C) help legislators better assess what policies are most appropriate to adopt.
D) make fiscal policy more responsive to the current economic environment.
E) cause fiscal policy to be more effective at changing the level of real GDP than changing the price level only in the long run.

Fiscal Policy

Fiscal Policy involves government spending and taxation decisions intended to influence economic activity, targeting issues like unemployment and inflation.

Economic Stabilization

Economic stabilization refers to government or central bank policies aimed at maintaining steady economic growth, minimizing unemployment, and stabilizing prices to prevent excessive inflation or deflation.

Lags

Delays between the time a policy is enacted and the time when its effects are felt in the economy.

  • Recognize the time lags associated with the approval and implementation of fiscal policy.
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Yordany ValdesNov 18, 2024
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