Question

Reagan’s supply side economic policy called for:

Answer 1

A. an increase in taxes

Answer 2

Answer:

The correct answer is D. Reagan’s supply side economic policy called for a decrease in taxes.

Explanation:

The supply-side economic policy is a macroeconomic school that holds that economic growth can be achieved more effectively with measures that increase aggregate supply by reducing barriers for people who produce (offer) goods and services, such as reducing taxes and by allowing greater flexibility through deregulation. According to it, consumers will end up benefiting from a greater offer of goods and services at lower prices. Policy recommendations typical of supply economists are lower tax rates and lower legal regulation of economic activity.