The amount of time it takes for fiscal policy to have an impact on the economy creates a(n) _______ lag.
A) information
B) formulation
C) implementation
D) direction

Question

Quizplus · Accepted Answer

The implementation lag refers to the time it takes for a policy to be put into action and for its effects to be felt in the economy. This lag can be significant since it requires coordination among various governmental bodies and may involve complex administrative and logistical issues. The other options (information and formulation lags) refer to different stages in the policymaking process and are not directly related to the impact of the policy on the economy. The direction lag is not a recognized term in economics.

The Amount of Time It Takes for Fiscal Policy to Have