QUESTION 11

Which of the following describes the time required for Congress to recgonize that the economy is experiencing a recession?

1. Legislative lag
2. Recognition lag
3. Implementation lag
4. Presidential lag

QUESTION 12

If Congress implements contractionary fiscal policy to address a positive GDP gap rather than allowing the economy to self correct,

1. The economy will eliminate the gap more quickly and the rate of inflation will fall
2. The economy will eliminate the gap more quickly and the rate of inflation will rise
3. The economy will eliminate the gap more slowly and the rate of inflation will fall
4. The economy will eliminate the gap more slowly and the rate of inflation will rise.

QUESTION 13

You are an aide to Representative Ann Wagner, a conservative St. Louis Congresswoman who supports a small role for government in the economy. If Congress needs to implement a contractionary policy, which fiscal policies would you suggest that she support? Explain your logic.