One Timing Problem in Using fiScal Policy to Counter a Recession

question 342

Multiple Choice

One timing problem in using fiscal policy to counter a recession is the "operational lag" that occurs between the

• A) start of the recession and the time it takes to recognize that the recession has started.
• B) start of a predicted recession and the actual start of the recession.
• C) time fiscal action is taken and the time that the action has its effect on the economy.
• D) time the need for the fiscal action is recognized and the time that the action is taken.

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Definitions:

Device

An instrument, tool, or machine created for a specific function or purpose, ranging from simple tools to complex machinery.

Economic Duress

A situation where one party is forced into a contract or agreement under the pressure of financial hardships, often exploiting that party’s vulnerable position.

Business Compulsion

A scenario where a business is forced to make a decision or take an action due to external pressures or unavoidable circumstances.

Fraud

Involves intentionally deceiving someone for personal gain or to damage another individual.