Multiple choice

President Ronald Reagan used the concept of supply-side economics when he proposed

  1. reducing income taxes to stimulate growth

  2. providing direct payments to people living in poverty

  3. creating government jobs to keep people working

  4. increasing regulations on business to promote competition
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A Correct answer
Explanation

Supply-side economics, often called Reaganomics, relies on the theory that reducing taxes on corporations and high-income earners will stimulate investment and economic growth. This is the opposite of demand-side or Keynesian policies.

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