Which of the following choices describes why the Fed might find it difficult to combat recessions? I. lags in the effects of monetary policy II. continuously changing economic conditions III. changes in the money supply, which do not always lead to expected changes in economic conditions.

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All three of the choices (I, II, and III) contribute to why the Fed might find it difficult to combat recessions. Monetary policy takes time to be implemented and its effects may not be seen until months later (lag). Economic conditions are constantly changing, making it difficult for the Fed to predict the best course of action to take. Additionally, changes in the money supply may not always lead to the expected changes in economic conditions, further complicating the implementation of effective monetary policy.

Which of the Following Choices Describes Why the Fed Might