The time required for a new fiscal policy to have the desired effect on the economy after implementation is called the

A) political lag
B) impact lag
C) recognition lag
D) decision lag

The time required for a new fiscal policy to have an impact on the economy after its implementation is known as the impact lag. This delay is due to the time needed for the policy to be put into action and for its effects to ripple through the economy. The other lags (political lag, recognition lag, and decision lag) refer to other stages in the policy-making process and are not directly related to the time it takes for the policy to have an effect on the economy.