Question 1 1 p Which of the following is NOT a relevant lag that would delay the effect of fiscal policy? O recognition lag O implementation lag O effectiveness lag O observation lag Question 2 1F The tools of fiscal policy are government expenditure and taxation. O True O FalseQuestion 4 1 pts (Figure: Aggregate Demand Conditions) Figure: Aggregate Demand Conditions Inflation Solow rate, IT growth curve SRAS A ADS NADA AD3 AD2 AD 3% Real GDP growth rate When the government lowers its spending growth so that the AD curve shifts from AD, to AD2 the multiplier effect will cause the AD curve to O shift back to AD1. O remain at AD2. O shift further to AD3. O shift all the way back to AD4.Question 3 1 pts The crowding-out effect reduces the effectiveness of fiscal policy in combating economic shocks. True O False