1st attempt Part 1 (1 point) 0 See Hi When fiscal policy is used to manage the e

Question

1st attempt Part 1 (1 point) 0 See Hi When fiscal policy is used to manage the economy, a number of factors can delay its impact. Which of the following is an example of a recognition lag? Choose one: o A. After the policy takes effect, it takes time for its complete effects to ripple through the economy. o B. After an elected official proposes to spend more money to stimulate economic growth, it takes time for other elected officials to agree and take action. o C. After a law is passed that authorizes government spending, the bureaucracy within the government needs time to set up needed processes and procedures, and to identify areas that have the greatest spending Although economic cond to confirm that conditions are bad enough. need for federal 0 itions seem bad enough to warrant government action, it takes time for economists o E. A decision to alter tax rates might apply only after the current tax year is completed See Hint Part 2 11 nnint SUBMIT ANSWER 16 OF 24 /24

Explanation / Answer

Answer. D. Although economic conditions seem bad enough to warrant govt action, it takes time for economists to confirm that condition are bad enough.

Lags associated with fiscal policy are the delays that take place in effectively restoring the ecnonomy. Four lags are associated with Fiscal POlicy:- Recongnition lag - Lag in recognising that conditions in economy needs govt intervention; Implementation lag - Lag in implementation of the govt policy; Effectiveness lag - reduced effectiveness due to fiscal policy not being timely for solving the issue; Decision lag - Time taken by the bureaucracy and misnisters to take the decision.

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.