To the extent that the political process of moving legislation through Congress is slow
A) the effect time lag will be long.
B) the recognition time lag will be long.
C) the action time lag will be long.
D) automatic stabilizers will not be effective.

Question

Quizplus · Accepted Answer

The action time lag refers to the time it takes for a fiscal policy measure to have an effect on the economy. If the political process of moving legislation through Congress is slow, it will take longer for the measure to be implemented, resulting in a longer action time lag. The recognition time lag refers to the time it takes for policymakers to recognize the need for a policy response, which is not affected by the speed of the political process. Automatic stabilizers can still be effective as they do not require legislative action. Therefore, choices A, B, and D are incorrect.

To the Extent That the Political Process of Moving Legislation