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What does the advocate for passive policy argue? The lags in stabilization policy can be very...

What does the advocate for passive policy argue?

The lags in stabilization policy can be very long that policies can do more harm than good

The fiscal policies can be influenced by political considerations and can lead to political business cycle

Fiscal policy might not be implemented promptly

All of the above
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Correct answer: D] All of the above

The advocate for passive policy argue monetary and fiscal policies work with long and variable lags attempts to stabilize the economy are likely to end up being destabilizing. in addition they believe that our present understanding of the economy is too limited to be useful in formulating successful stabilization policy and that inept policy is frequent source of economic fluctuations. Fiscal policy might not be implemented promptly

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