The inside lag is the time:
A) before automatic stabilizers respond to economic activity.
B) after automatic stabilizers respond to economic activity.
C) between a shock to the economy and the policy action responding to the shock.
D) between a policy action and its influence on the economy.

Question

Quizplus · Accepted Answer

The inside lag refers to the delay between when an economic shock occurs and when policy actions (such as fiscal or monetary policy adjustments) are implemented in response to that shock.

The Inside Lag Is the Time