The Use of Fiscal Policy to Stabilize the Economy Is

question 248

Multiple Choice

The use of fiscal policy to stabilize the economy is limited because

• A)changes in government spending and tax rates have a small effect on aggregate demand.
• B)changes in government spending and tax rates have a small effect on interest rates.
• C)the legislative process can be slow,which means that it is difficult to make fiscal policy actions in a timely way.
• D)the Internal Revenue Service (IRS)resists changes in tax rates because of all the changes they would have to make to the tax code.

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Definitions:

Defects

Imperfections or faults in a product or process that deviate from the desired specifications, affecting quality.

Sigma Control Limits

Statistical boundaries set in process control that represent acceptable variations in product quality or process performance, typically associated with Six Sigma methodology.

Sample Ranges

The difference between the highest and lowest values in a set of data samples, often used in statistical analysis to measure variability.

Producer's Risk

Producer's risk is the probability of rejecting a quality product during the inspection process, falsely identifying it as defective.