The amount of time that it takes between recognizing an economic problem and implementing policy to solve it is
A) fiscal policy.
B) the recognition time lag.
C) the effect time lag.
D) the action time lag.

Question

Quizplus · Accepted Answer

The time lag between recognizing an economic problem and implementing policy to solve it is referred to as the action time lag. This is the amount of time it takes for the appropriate authorities to decide on the most effective policy to implement and then put it into action. The recognition time lag refers to the time it takes for policy-makers to become aware of and identify an economic problem. Fiscal policy refers to the use of government spending and taxation to influence the economy. The effect time lag refers to the time it takes for a policy to have its full impact on the economy.

The Amount of Time That It Takes Between Recognizing an Economic