There are four limitations to the effectiveness of discretionary fiscal policy.Which item below is NOT one of these limitations?
A)shrinking area of lawmaker discretion
B)lawmaking time lag
C)estimating potential GDP
D)fiscal multiplier
E)economic forecasting

Question

Quizplus · Accepted Answer

The fiscal multiplier is a concept used to measure the impact of fiscal policy on the economy, not a limitation to its effectiveness. The other options are limitations related to the challenges and delays in implementing and assessing fiscal policy.

There Are Four Limitations to the Effectiveness of Discretionary Fiscal