Which of the following illustrates the wait-and-see lag?
A) Policymakers believe an economic downturn has occurred,but they decide not to take action until they are sure.
B) Policymakers are in the process of proposing policy measures to deal with the current economic slowdown.
C) Policymakers first learn of the recession when it is five months old.
D) Policymakers implement policy X,but it will be a few months before it starts working.
E) Policymakers agree to policy X,but it will be at least two months before the policy is implemented.

Question

Quizplus · Accepted Answer

The wait-and-see lag refers to the delay in policymakers taking action because they want to be sure that a downturn is actually occurring before implementing policies. Choice A matches this definition, as policymakers delay taking action until they are confident that a recession has occurred.

Which of the Following Illustrates the Wait-And-See Lag