One argument often heard against using fiscal policy to tame the business cycle is that the lags associated with getting a fiscal policy implemented are so long that when the program is finally passed and implemented, the business cycle has moved on to the next phase and the new program may not be necessary and may even be potentially destabilizing at that point. Does this argument seem reasonable? What counterarguments can you make in support of using fiscal policy?

One argument often heard against using fiscal policy to tame the business cycle is that the lags associated with getting a fiscal policy implemented are so long that when the program is finally passed and implemented, the business cycle has moved on to the next phase and the new program may not be necessary and may even be potentially destabilizing at that point. Does this argument seem reasonable? What counterarguments can you make in support of using fiscal policy?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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