What is the aim of supply-side economics?
A) to increase government spending in order to stimulate aggregate supply
B) to stimulate exports in order to increase the balance of payments
C) to decrease wages in order to make production cheaper
D) to lower taxes in order to increase the supply of resources

Question

What is the aim of supply-side economics?  
A) to increase government spending in order to stimulate aggregate supply 
B) to stimulate exports in order to increase the balance of payments 
C) to decrease wages in order to make production cheaper 
D) to lower taxes in order to increase the supply of resources

Quizplus · Accepted Answer

The aim of supply-side economics is to increase the supply of resources by lowering taxes. This is based on the belief that lower taxes encourage people to work more and invest in businesses, which in turn increases production and economic growth. This is also known as Reaganomics, named after President Ronald Reagan who implemented these policies in the 1980s.

What Is the Aim of Supply-Side Economics