Countercyclical fiscal policy has a serious problem with
A) the timing of its enactment and impact.
B) the easy reversibility of policy.
C) the tendency of the Federal Reserve to immediately counter Congressional action.
D) the courts as it has been held to be unconstitutional.
E) Presidential executive orders.

Question

Quizplus · Accepted Answer

Countercyclical fiscal policy involves enacting policies that counteract economic cycles. The problem with this approach is that by the time the policy is enacted, it may be too late to have a significant impact on the economy. Additionally, the impact of the policy may take time to filter through the economy. Therefore, timing is a serious challenge when enacting countercyclical fiscal policies.

Countercyclical Fiscal Policy Has a Serious Problem with