Which statement regarding supply-side fiscal policy is INCORRECT?
A) It tends to have a longer impact on the economy than demand-side policies.
B) It is geared toward short-term increases in employment.
C) It attempts to increase the long-run equilibrium level of GDP.
D) It tends to lower prices in the economy.

Question

Quizplus · Accepted Answer

Supply-side fiscal policy focuses on improving productivity and efficiency in the long run, which in turn can lead to increases in employment. However, this is not its primary goal, as it is geared toward increasing the long-run equilibrium level of GDP, not short-term employment gains.

Which Statement Regarding Supply-Side Fiscal Policy Is INCORRECT