Long-Term Contrast in Policy Control Over Output vs. Inflation

A government announces a new fiscal stimulus package with the stated goal of increasing the country's economic output by exactly 1.5% within the next fiscal year, without causing any change in the rate of inflation. Which of the following statements best evaluates the likely outcome of this policy?

Evaluating Policy Outcomes

The Challenge of Economic Fine-Tuning

If policymakers have access to accurate, real-time economic data and sophisticated forecasting models, they can implement fiscal or monetary policies that will achieve a precise, predetermined target for economic output without affecting inflation.