ich of the following is NOT the limitation to the use of discretionary fiscal policy to stabilize the economy? ect one or more: changes in government purchases and tax rates have a small effect on interest rates the fine-tuning is very costly and may result in a destabilizing effect changes in government purchases and tax rates have a small effect on aggregate demand

Exploring Economics
8th Edition
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:Robert L. Sexton
Chapter24: Fiscal Policy
Section: Chapter Questions
Problem 5P
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Which of the following is NOT the limitation to the use of discretionary fiscal policy to stabilize the economy?
Select one or more:
O changes in government purchases and tax rates have a small effect on interest rates
the fine-tuning is very costly and may result in a destabilizing effect
O changes in government purchases and tax rates have a small effect on aggregate demand
O the political process can be slow, which means that it is challenging to make fiscal policy actions in a timely way
Transcribed Image Text:Which of the following is NOT the limitation to the use of discretionary fiscal policy to stabilize the economy? Select one or more: O changes in government purchases and tax rates have a small effect on interest rates the fine-tuning is very costly and may result in a destabilizing effect O changes in government purchases and tax rates have a small effect on aggregate demand O the political process can be slow, which means that it is challenging to make fiscal policy actions in a timely way
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