Fiscal policy lags:
A) are generally shorter than monetary policy lags.
B) are generally longer than monetary policy lags.
C) are generally the same length as monetary policy lags.
D) may be shorter or longer than monetary policy lags.

Question

Quizplus · Accepted Answer

Fiscal policy lags are generally longer than monetary policy lags because fiscal policy requires legislative action and appropriations, which can take longer to implement than the decisions made by a central bank to change interest rates.

Fiscal Policy Lags