One timing problem in using ﬁscal policy to counter a recession is the "recognition lag" that occurs between the
A) start of the recession and the time it takes to recognize that the recession has started.
B) start of a predicted recession and the actual start of the recession.
C) time ﬁscal action is taken and the time that the action has its effect on the economy.
D) time the need for the ﬁscal action is recognized and the time that the action is taken.

Question

Quizplus · Accepted Answer

The recognition lag refers to the delay between the onset of a recession and when policymakers recognize that the recession has begun, impacting the timing of fiscal policy responses.

One Timing Problem in Using ﬁScal Policy to Counter a Recession