The Use of Fiscal Policy Is Limited Because

question 19

Multiple Choice

The use of fiscal policy is limited because

• A) there is never a long enough time lag.
• B) the economy is almost always at full employment.
• C) the President may have different goals than Congress.
• D) time lags associated with fiscal policy may cause the policy to take effect too late to solve the problem it was supposed to address.

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Definitions:

Exchange Rates

Exchange rates are the value at which one currency can be exchanged for another, impacting international trade, investments, and economic policies.

Union Labour Prices

The costs associated with hiring labor that is part of a labor union, often including higher wages and benefits.

Labour Content

The total amount of work or labor input required to complete a task or produce a good, often measured in labor hours.

Political Risk

The risk associated with political changes or instability in a country that can affect the operations and profitability of businesses.