The emphasis on the greater incentives to produce created by lower taxes has come to be known as:
A)trickle-down economics.
B)supply-side economics.
C)the paradox of thrift.
D)the permanent income hypothesis.
E)monetarist economics.

Question

Quizplus · Accepted Answer

The emphasis on lower taxes creating greater incentives to produce is a key principle of supply-side economics. This economic theory emphasizes the importance of boosting production and encouraging investment in order to stimulate economic growth, rather than just focusing on consumer demand. Trickle-down economics (A) is a similar concept, but it emphasizes the idea that benefits for the wealthy will eventually "trickle down" to benefit all members of society. The paradox of thrift (C) is a different economic concept that refers to the idea that if everyone saves more, it can actually lead to lower overall savings and economic contraction. The permanent income hypothesis (D) is a theory that suggests that people base their consumption decisions on their expected long-term income rather than their current income. Monetarist economics (E) emphasizes the importance of controlling the money supply in order to maintain stable prices and promote economic growth.

The Emphasis on the Greater Incentives to Produce Created by Lower