A Congressional representative who calls for a decrease in tax rates in order to increase saving, work effort, and economic growth would most likely be advocating:
A) An easy money policy
B) A tight money policy
C) A supply-side fiscal policy
D) A contractionary fiscal policy

Question

Quizplus · Accepted Answer

A supply-side fiscal policy focuses on increasing the supply of goods and services in an economy by providing tax incentives for businesses and individuals to encourage savings, investments, and work effort. By decreasing tax rates, individuals have more disposable income, which can be used for savings or investment, and businesses have more retained earnings available for expansion or improvement. This policy approach assumes that by increasing the supply of goods and services, economic growth will follow.

A Congressional Representative Who Calls for a Decrease in Tax