Fiscal Policy Formation Causes a Delay in Implementation Even Though

question 128

True/False

Fiscal policy formation causes a delay in implementation even though a recession can usually be recognized within a few weeks after it begins.
A limitation on fiscal policy is time.In the real world it takes time to recognize that the economy is in trouble.A blip in the unemployment or inflation rate may not signal a trend.Before intervening,we may want to be more certain that a recessionary or inflationary GDP gap is emerging.