What are the differences between demand-side and supply-side fiscal policies?

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Darryn D'SouzaLv10

28 Sep 2019

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Discuss the differences between Keynesian and Supply-Side fiscal policies. Which should be used to alleviate Stagflation? Explain with details.

1. Contractionary fiscal policy:

a) leaves aggregate demand unchanged.

b) increases aggregate demand.

c) decreases aggregate demand.

d) increases aggregate supply.

2. Supply-side fiscal policies include all of the following EXCEPT:

a)	increasing transfer payments.

b)	projects that include the encouragement of new technologies.

c)	policies that encourage investment in research and development.

d)	investment in human capital.

Government tax and expenditure policies that affect real GDP are called:

A) automatic fiscal policy.
B) discretionary fiscal policy.
C) fiscal policy.
D) supply-side policy.

Economics 400,000