Which Monetary Policy time lag is the longest and likely most troublesome? A) Effectiveness Lag B) Implementation Lag C) Legislative Lag D) Data Lag
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The question asks us to identify which type of monetary policy time lag is the longest and likely most troublesome among the given options. Show more…
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Monetary policy affects the economy with a lag mainly because it takes a long time a. for central banks to make policy changes. b. to change the money supply after a policy decision has been made. c. for a change in the money supply to affect interest rates. d. for a change in interest rates to affect investment spending.
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Do you think the typical time lag for fiscal policy is likely to be longer or shorter than the time lag for monetary policy? Explain your answer?
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