It is probably easier to use monetary policy than fiscal policy. Why?

I. Monetary policy has smaller recognition lags.
II. Monetary policy has smaller implementation lags.
III. Monetary policy has smaller outside lags.
IV. There are fewer forecasting uncertainties with monetary policy.

Correct Answer: II only

In the U.S., for example, the FOMC meets many times a year and can decide on policy changes at any time. It is easier to implement monetary policy than fiscal policy, which must generally go through Congress.