Time Lags in the Implementation of Fiscal Policy

question 196

Multiple Choice

Time lags in the implementation of fiscal policy:

• A)make use of fiscal policy easier.
• B)render such policies useless.
• C)must be considered in implementation.
• D)are less problematic than those facing monetary policy.

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Definitions:

Taxable Income

The sum of money earned by a person or a business that is used to calculate the owed tax payable to the government.

After-Tax Income

The amount of income that remains after all taxes have been deducted.

Sales Tax

A tax levied by a government on the sale of goods and services, typically calculated as a percentage of the selling price.

Excise Taxes

Taxes imposed on specific goods, services, or activities, often used to discourage consumption of certain items or to raise revenue for targeted purposes.