_____44. Tax cuts under President George W. Bush’s terms as president was a retu
ID: 1209147 • Letter: #
Question
_____44. Tax cuts under President George W. Bush’s terms as president was a return to which school of economic thought?
Classical.
Supply-Side.
Monetarism.
Keynesian.
New Classical.
_____45. Supply-Side Economics emphasis on the manipulation of production in an economy has its roots in the classical theory of:
The Invisible Hand.
Malthus’ Theory on Population.
Ricardo’s Comparative Advantage.
Say’s Law of Markets.
Smith’s Theory of International Trade.
_____46. Which school of economic thought emphasized the most active role for government in the economy?
Supply-Side Economics.
New Classical Economics.
Monetarism.
Reaganomics.
Keynesian Economics.
_____47. Which school of economic thought emphasized the least active role for government in the economy?
A. Supply-Side Economics.
New Classical Economics.
Monetarism.
Reaganomics.
Keynesian Economics.
_____48. According to Friedman, social security discourages employers from hiring additional workers. It was in this context that he referred to social security as:
“an unfair burden.”
“the program from hell.”
“not relevant.”
“a tax on work.”
“a negative income tax.”
Explanation / Answer
Q44. The correct answer is option (2).
Reason - It is the supply-side economic theory that recommends the lower marginal tax rates and lower or less government regulation as essential ingredients for stimulating economic growth. In fact, tax policy is an important aspect of supply-side economics.
So, when President Bush undertook tax cuts, it is the supply-side economics that has made the return.
Q45. The correct answer is option (4).
Reason - Supply-side economics has its roots in the Classical theory of Say's Law of Market.
Say's Law of Market states that Supply creates its own Demand. Likewise, supply-side economists also believe that it is not the demand but the supply that tends to set the pace of economic growth.
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.