The problem with fiscal policy that is created because of the recognition,legislative,implementation,effectiveness,and the evaluation and adjustment lags is called:
A) crowding out.
B) a drop in the bucket.
C) a matter of timing.
D) a real shock.

Question

Quizplus · Accepted Answer

Fiscal policy actions take time to go through the entire process from recognition of a problem to implementation and ultimately evaluation and possible adjustment. Therefore, the timing of fiscal policy can be a problem, leading to the recognition, legislative, implementation, effectiveness, and evaluation and adjustment lags. This can result in the policy being ineffective or even counterproductive.

The Problem with Fiscal Policy That Is Created Because of the Recognition,legislative,implementation,effectiveness,and