Which of the following is most consistent with supply-side policy?
A)The Workforce Investment Act,which increased funds for skill training.
B)The increase in the interest rate six times during 1999-2000 by the Fed.
C)The decrease in the growth of the money supply in 1994.

Question

Quizplus · Accepted Answer

Supply-side policy focuses on increasing the supply of goods and services by promoting economic growth through policies that encourage businesses to produce more. The Workforce Investment Act, which increased funds for skill training, would help to increase the productivity of workers and therefore the supply of goods and services. The increase in interest rates by the Fed and the decrease in the growth of the money supply would both be examples of demand-side policies aimed at controlling inflation and reducing aggregate demand, and are not consistent with supply-side policy.

Which of the Following Is Most Consistent with Supply-Side Policy