The response lag of stabilization policy represents?

2101EconomicsMedium

Athe time needed for parliament to agree to a tax cut.

Bthe time that it takes for the economy to adjust to the new conditions after a new policy has been implemented

Cthe time that is necessary to put the desired policy into effect

Dthe time that it takes for policy makers to recognize the existence of boom of bust

Correct answer

B. the time that it takes for the economy to adjust to the new conditions after a new policy has been implemented

Explanation

The correct answer is the time that it takes for the economy to adjust to the new conditions after a new policy has been implemented.

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