Question

Outside time lags are delays in the economy's response to stabilization policies.

True

false

Answer 1

Answer -

The given statement is false

Explanation -

In economics outside time lag refers to span of time required by the government or central bank for implementing actions by monetary or fiscal policy and result of its effect on economy.In case of outside lags it is continued up to to new government spending or tax policies so it doesn't make delays in stabilization policy. As soon as new government spending and new tax structure creates ,it will result in to stabilization policy. As compared to outside time lags ,inside time lags are delays in the economy's response to stabilization policy.