Choose the statement that is not true.

A. Fiscal policy always causes inflation.
B. Fiscal policy is conducted by the executive branch of the U. S. government.
C. Time lags make fiscal policy difficult.
D. Crowding out reduces the impact of an expansionary fiscal policy.

B. Fiscal policy is conducted by the executive branch of the U.S. government.

Explanation:

Fiscal policy can be defined as a policy that is put in place by the government of a country to monitor, regulate and adjust the rate at which the government spends money as well as the amount of taxes collected by the government.

Fiscal policy helps to keep the economy of a country stable by finding means to tackle unemployment issues as well as the prices of goods and services in that country.

We have 3 types of Fiscal policy. They are:

a. Expansionary policy

b. Contractionary policy

c. Neutral policy.

In the United States, Fiscal policy is conducted and coordinated by both the Executive and Legislative arms of the government.

One of the effects of fiscal policy when implemented is that it can lead to the rise of inflation in a country.

Time lags also known as the delay in amount of time it takes to implement a thing can affect the proper implementation of a fiscal policy.

An increase in the spending of a government leads to crowding out and this can have a negative effect on the fiscal policy in a country most especially the expansionary policy. This negative effect is that it reduces the impact or effect that a well implemented fiscal policy would have on a country.