The most important lag for monetary policy is the time it takes to formulate policy, while the most important lag for fiscal policy is the time it takes for the economy to respond to changes in government spending.

Question

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The most important lag for monetary policy is often the time it takes for the economy to respond to changes in interest rates or other monetary measures, while the most important lag for fiscal policy is typically the time it takes to implement changes in government spending or taxation.

The Most Important Lag for Monetary Policy Is the Time