Which of these is a supply-side approach to increase growth? Investing in the pr

Question

Which of these is a supply-side approach to increase growth? Investing in the production of arms and ammunitions Spending on the construction and repair of state highways Providing tax benefits to start-up companies Increasing transfer payments to retirees Replacing old aircrafts with new fighter planes The mercantilism policy failed to generate gains from trade for countries which adopted it because of O retaliations from other countries. runaway inflation in the U.S. high levels of federal debt supply-side shocks from the oil-exporting countries. increases in consumer spending

Explanation / Answer

The correct choice is :- Providing tax benefits to startup companies

Explanation : - Tax benefits given to startup companies will increase the investment and produce greater benefit for the economy in terms of a higher rate of growth , resulting in a greater reduction in unemployment.

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The correct choice is : - Retaliations from other countries

Explanation : - Mercantilism was based on the idea that only gold and silver create wealth; and exporting (worthless) goods would imply the acquisition of precious metals. Unfortunately, mercantilist empires were not willing to trade with each other, because none of them wanted to pay in gold or silver in order to receive goods. Therefore, most mercantilist countries tried to acquire colonies and they came into conflict with other countries.

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