ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Supply-side fiscal policy focuses on creating a better climate for businesses. Its tools are tax cuts and deregulation. According to the theory, companies that benefit from these policies are able to hire more workers. The resultant job growth creates more demand which further boosts the economy.

Detailed explanation-2: -supply-side economics, also calledtrickle-down economics, theory that focuses on influencing the supply of labour and goods, using tax cuts and benefit cuts as incentives to work and produce goods.

Detailed explanation-3: -Examples of Supply-Side Policies Reducing marginal tax rates. Lower tax rates on interest earned from savings. Higher tax credits on investment. Less government regulation, including the minimum wage.

Detailed explanation-4: -Expansionary fiscal policy, designed to stimulate the economy, is most often used during a recession, times of high unemployment or other low periods of the business cycle. It entails the government spending more money, lowering taxes or both.