Author Question: Those who favor a passive approach to policy believe that: a. discretionary monetary policy can be ... (Read 39 times)

CBme · **on:** Jun 30, 2018

Those who favor a passive approach to policy believe that:
a. discretionary monetary policy can be used to help the economy since monetary policy lags are short.
b. discretionary fiscal policy can be used to help the economy since fiscal policy lags are short.
c. lags associated with implementing policies are too long and unstable for discretionary policy to be effective.
d. despite the lags involved, implementing discretionary policy is preferable to inaction.
e. automatic stabilizers cannot be used to help the economy since monetary policy lags are short.

Question 2

The time required _____ is not a time lag associated with using discretionary policy to correct an economic problem.
a. to recognize the problem
b. to decide how to handle the problem
c. to set a policy change in action
d. for a policy to affect economic variables
e. to observe public reaction after a policy announcement is made