________ policy and ________ policy have similar recognition time lags.
A) Contractionary; expansionary
B) Growth; recession
C) Fiscal; monetary
D) Implementation; response

Question

Quizplus · Accepted Answer

Fiscal policy and monetary policy both have similar recognition time lags. The recognition time lag is the time it takes for policymakers to recognize that the economy is experiencing a problem, such as inflation or a recession, and to take action to address it. Fiscal policy involves changes in government spending and taxation, which can take several months to implement after recognition of a problem. Monetary policy involves changes in interest rates and money supply, which can take several months to affect the economy after recognition of a problem. Therefore, both fiscal and monetary policy have similar recognition time lags.

________ Policy and ________ Policy Have Similar Recognition Time Lags

Policy and Policy Have Similar Recognition Time Lags