All of the Following Are Arguments Against Stabilization Policy Except

question 41

Multiple Choice

All of the following are arguments against stabilization policy except

• A)Economic forecasting is highly imprecise.
• B)Long lags may cause stabilization policies to in fact destabilize the economy.
• C)Monetary policy affects aggregate demand by changing interest rates.
• D)Fiscal policy must go through a long political process.

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Definitions:

Exchange Rates

The rate at which one currency can be exchanged for another currency, influencing international trade and investments.

Calendar Year End

The end of an accounting period that concludes on December 31st.

Forward Contract

A financial derivative contract between two parties to buy or sell an asset at a specified future date for a price agreed upon today.

Canadian Dollars

The currency of Canada, represented by the symbol CAD or C$.