Lags in the Approval and Implementation of Fiscal Policy

question 34

Multiple Choice

Lags in the approval and implementation of fiscal policy:

• A)weaken fiscal policy as a tool of economic stabilization.
• B)increase the effectiveness of fiscal policy as a tool of economic stabilization.
• C)help legislators better assess what policies are most appropriate to adopt.
• D)make fiscal policy more responsive to the current economic environment.
• E)cause fiscal policy to be more effective at changing the level of real GDP than changing the price level only in the long run.

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