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Why Are Fiscal Tools Sometimes Difficult to Use in Regulating

Question 187
Multiple Choice
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Multiple Choice

Why are fiscal tools sometimes difficult to use in regulating the economy?

A) Decisions on spending and taxation are not solely made on the basis of their potential economic effects.
B) Federal spending cannot be easily adjusted up or down as economic conditions change.
C) Decisions by Congress to lower the discount rate to federal banks are a cumbersome process.
D) Changes in spending and taxes can occur quickly, before many economists can agree on what the problem is.
E) Decisions about how much government should spend are made by a small group of people.

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