Question

What is the difference between inside lag and outside​ lag?

a. inside lag is the time it takes to formulate a​ policy, outside lag is the time it takes to debate policy.
b. inside lag is the time it takes for investors to​ approve, outside lag is the time it takes for the policy to work.
c. inside lag is the time it takes to formulate a​ policy, outside lag is the time it takes for the policy to work.
d. inside lag is the time it takes for the policy to​ work, outside lag is the time it takes to formulate a policy?

Answer 1

The answer is : inside lag is the time it takes to formulate a​ policy, outside lag is the time it takes for the policy to work. Inside lag is delay in implementing policy. it can take additional time to enact policies, which is more monetary policy. Outside lag is the time it takes for monetary policy to have an effect. for fiscal policy the outside lag lasts as long as is required for new government spending or tax policies.