Countercyclical Fiscal Policy Has a Serious Problem with

question 80

Multiple Choice

Countercyclical fiscal policy has a serious problem with

• A) overshooting the desired impact by a factor of 10.
• B) the irreversibility of actions.
• C) the tendency of the Federal Reserve to immediately counter Congressional action.
• D) the courts as it has been held to be unconstitutional.
• E) overshooting the desired impact by a factor of 3.

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Definitions:

Quantity Demanded

The amount of a product that consumers are willing and able to purchase at a specified price within a given time period.

Minimum Wage

The lowest legal hourly pay that workers can be paid by employers, set by government legislation.

Unemployment

The situation in which individuals who are capable of working and willing to work cannot find employment.

Black Market

An illegal traffic or trade in officially controlled or scarce commodities, bypassing governmental regulation or taxation.