The lag that occurs between changes in relative prices and the quantities of goods traded is the
A) Recognition lag
B) Recovery lag
C) Implementation lag
D) Legislative lag

Question

Quizplus · Accepted Answer

The recognition lag is the time it takes for individuals and markets to recognize changes in relative prices. This lag can occur due to factors such as imperfect information, market inefficiencies, and individual decision-making processes. The other answer choices do not accurately describe this lag.

The Lag That Occurs Between Changes in Relative Prices and the Quantities