Supply-Side Policies MCQs

Option A: subsidies to encourage firms that moves

Option B: tax concessions for firms that move.

Option C: improved infrastructure

Option D: all of the above

Correct Answer: all of the above ✔

Option A: market-orientated economists

Option B: left-wing theorists

Option C: Keynesian.

Option D: new-Keynesian

Correct Answer: market-orientated economists ✔

Option A: publicly held stock to private individuals

Option B: corporately owned businesses to individuals

Option C: government businesses to the private sector.

Option D: privately owned businesses to the government sector

Correct Answer: government businesses to the private sector. ✔

Option A: the charities economy

Option B: the demand side of the economy

Option C: the underground economy

Option D: the supply side of the country

Correct Answer: the supply side of the country ✔

Option A: there is no income effect when tax rates are changed

Option B: the income effect of a wage change is greater than the substitution effect of a wage change.

Option C: there is no substitution effect when tax rates are changed

Option D: the substitution effect of a wage change is greater than the income effect of a wage change

Correct Answer: the substitution effect of a wage change is greater than the income effect of a wage change ✔

Option A: An increase in the minimum wage that would cause consumer spending to increase

Option B: investment tax credits for businesses to encourage investment

Option C: Restrictions placed on the amount that can be imported.

Option D: An increase in government spending that would lead to increased aggregate demand

Correct Answer: investment tax credits for businesses to encourage investment ✔

Option A: bureaucracy

Option B: bad luck

Option C: poor communications

Option D: the low level of government grants and by the fact that some projects would have gone ahead anyway

Correct Answer: the low level of government grants and by the fact that some projects would have gone ahead anyway ✔

Option A: New classical economists.

Option B: Left wing theorists

Option C: interventionist policies.

Option D: monetarists.

Correct Answer: interventionist policies. ✔

Option A: Technological change has made it possible for many industries to become more competitive

Option B: Because few real natural monopolies exist, there is rarely a reason for government regulation.

Option C: Many instances of government regulation have succeeded in reducing competition in industries where competition may be beneficial

Option D: All of the above

Correct Answer: All of the above ✔

Option A: reduce poverty

Option B: reduce unemployment

Option C: weaken the power of trade unions

Option D: help small businesses

Correct Answer: reduce unemployment ✔

Option A: initially increase and then decrease

Option B: decrease continuously.

Option C: rise continuously

Option D: initially decrease and then increase.

Correct Answer: initially increase and then decrease ✔

Option A: aggregate supply will increase will increase aggregate demand will decrease and the price level will decrease

Option B: aggregate supply will increase will increase aggregate output will increase and the price level will decrease

Option C: aggregate supply will increase will increase aggregate output will increase and the price level will increase

Option D: both aggregate supply and demand will increase will increase and the price level will increase

Correct Answer: aggregate supply will increase will increase aggregate output will increase and the price level will decrease ✔

Option A: Supply-side economics

Option B: neo-Keynesian economists

Option C: rational-expectations economists.

Option D: new classical economists.

Correct Answer: Supply-side economics ✔