There Are Four Limitations to the Effectiveness of Discretionary Fiscal

question 22

Multiple Choice

There are four limitations to the effectiveness of discretionary fiscal policy. Which item below is NOT one of these limitations?

• A) The fiscal multiplier
• B) The shrinking area of Parliamentary discretion
• C) The legislation time lag
• D) Estimating potential GDP
• E) Errors in economic forecasting

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Definitions:

Early Successes

Achievements or positive outcomes that occur at the beginning stages of a venture or project.

High Position

A status within an organization that carries a significant level of authority, responsibility, and influence over decision-making processes.

Power

The capacity or ability to direct or influence the behavior of others or the course of events.

Prestige

The level of respect, admiration, or esteem that a person, organization, or entity is regarded with, often based on perceived success, achievement, or quality.