Macroeconomic Policy Tools


Q.  Which of the following statements about stabilization policy is not true ?

a. Many economists prefer automatic stabilizers because they affect the economy with a shorter lag than activist stabilization policy
b. None of these answers are true
c. Long lags enhance the ability of policy makers to fine tune the economy
d. When policy makers implement activist stabilization policies there is a significant risk that their policies may actually have a destabilizing effect


ANSWER: See Answer
 
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