The time it takes for a new policy to register its full impact on an economy after it has been put in force is known as the _____
A) activity lag.
B) decision-making lag.
C) effectiveness lag.
D) implementation lag.
E) recognition lag.

Question

Quizplus · Accepted Answer

The effectiveness lag refers to the time it takes for a new policy to have its full impact on the economy after it has been implemented. This lag can be influenced by various factors such as the complexity of the policy, the time it takes for agents in the economy to adjust their behavior, and the speed of transmission mechanisms. The other lags - activity lag, decision-making lag, and implementation lag - refer to different stages in the policy-making process. The recognition lag is the time it takes for policymakers to recognize a problem and take action.

The Time It Takes for a New Policy to Register