Refer to the information provided in Figure 15.1 below to answer the questions that follow. Figure 15.1
-Refer to Figure 15.1.If policy makers decide on a policy at point t3 but it does not affect the economy until period t6,then the policy choice is likely to be
A)stabilizing.
B)destabilizing.
C)optimal.
D)automatically stabilizing.

Question

Refer to the information provided in Figure 15.1 below to answer the questions that follow.  Figure 15.1
-Refer to Figure 15.1.If policy makers decide on a policy at point t3 but it does not affect the economy until period t6,then the policy choice is likely to be
A)stabilizing. 
B)destabilizing. 
C)optimal. 
D)automatically stabilizing.

Quizplus · Accepted Answer

If the policy does not take effect until period t6, it is likely to be destabilizing because it will not be able to stabilize the economy in the short term. This means that any economic fluctuations that occur between t3 and t6 will not be addressed by the policy, potentially making them worse.

Refer to the Information Provided in Figure 15