AP Macroeconomics 3.8.2: Policy Lags
Compare fiscal and monetary policy tools and the lags between implementation and aggregate-demand effects.
- Syllabus
- Effective Fall 2025
- Course
- AP Macroeconomics
POL-1.B—Define why there are lags to discretionary fiscal policy question 1
[Maximum number: 1]
Which of the following is true about changes in tax rates, changes in the level of government expenditures, and changes in the money supply?
A
They are automatic stabilizers.
B
They are tools of discretionary fiscal policy.
C
They have different lag times between implementation of a policy and its effects on aggregate demand.
D
They are favored equally by both classical and Keynesian economists to fine-tune the economy.
E
All are controlled by the Federal Reserve system.
C
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