The arguments against the use of active stabilization policy include all of the following except:
A)the responsiveness of voluntary unemployment to changes in GDP.
B)the existence of policy lags.
C)weak macroeconomic forecasting abilities.
D)the possibility of policy errors because of limited information.

Question

Quizplus · Accepted Answer

The argument mentioned in option A is in favor of active stabilization policy as it suggests that changes in GDP can affect voluntary unemployment. The other options are arguments against using active stabilization policy.

The Arguments Against the Use of Active Stabilization Policy Include