The use of supply-side fiscal policy always requires a tradeoff between output and the price level.

Question

Quizplus · Accepted Answer

Supply-side fiscal policy, which involves tax cuts and deregulation to encourage production, does not inherently require a trade-off between output and the price level. It aims to increase aggregate supply, potentially increasing output without necessarily increasing the price level, depending on other economic conditions.

The Use of Supply-Side Fiscal Policy Always Requires a Tradeoff