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 at time t5 that the economy is expanding too fast,but the policy changes start affecting the economy at t7,then the policy will be
A)inappropriate.
B)well timed.
C)ineffective.
D)optimal.

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 at time t5 that the economy is expanding too fast,but the policy changes start affecting the economy at t7,then the policy will be
A)inappropriate. 
B)well timed. 
C)ineffective. 
D)optimal.

Quizplus · Accepted Answer

The policy will be inappropriate because there is a time lag between the decision and its effect, causing the policy to take effect when the economic conditions may have already changed.

Refer to the Information Provided in Figure 15