The effectiveness lag is
A) the time it takes for policy makers to obtain data indicating what is happening in the economy.
B) the time it takes for policy makers to be sure of what the data are signaling about the future course of the economy.
C) the time it takes to pass legislation to implement a particular policy.
D) the time it takes for policy makers to change policy instruments once they have decided on the new policy.
E) the time it takes for the policy actually to have an impact on the economy.
E
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Given that you observe nothing but the low price of the product, you are more likely to infer that
a. The product is high quality b. The product is the highest quality possible c. The product is low quality d. None of the above
Adverse selection in insurance requires that
a. all people face the same risk b. potential customers facing more risk are more interested in purchasing insurance c. people are not risk averse d. insurers can tell higher risk people from lower risk people