Economists who are skeptical of the Fed's ability to fine tune the economy argue that lags in the effect of monetary policy make it difficult to properly time this policy. monetary policy only affects output in the long run. Fiscal policy affects output more quickly than monetary policy. Monetary policy does not have any effect on output.
Economists who are skeptical of the Fed's ability to fine tune the economy argue that lags in the effect of monetary policy make it difficult to properly time this policy. monetary policy only affects output in the long run. Fiscal policy affects output more quickly than monetary policy. Monetary policy does not have any effect on output.
Chapter24: Fiscal Policy
Section: Chapter Questions
Problem 15P
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