Explain Why the Timing of Fiscal Policy May Be More

question 132

Essay

Explain why the timing of fiscal policy may be more difficult than the timing of monetary policy.

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Definitions:

Unearned Revenue

Money received by a company for goods or services yet to be delivered or provided, recorded as a liability.

Liability

An obligation of an entity arising from past transactions or events, the settlement of which may result in the transfer or use of assets, provision of services, or other yielding of economic benefits in the future.

Fixed Asset

Long-term tangible property owned by a business that is used in its operations and not expected to be converted to cash in the short term.

Market Value

The current price at which an asset or service can be bought or sold, often determined by supply and demand in the marketplace.