Policy makers may not know that the economy is in a recession until six months after the recession starts;this phenomenon is known as the _____.
A)implementation lag
B)policy coordination problem
C)decision-making lag
D)recognition lag
E)effectiveness lag

Question

Quizplus · Accepted Answer

The recognition lag refers to the time it takes for policy makers to recognize that the economy is in a recession. It can take up to six months for economic data to be collected and analyzed, meaning that policy makers may not be aware of a recession until it is already underway.

Policy Makers May Not Know That the Economy Is in a Recession