ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Supply-side economics also aims to decrease regulation, which can lower business costs and remove government restrictions, enabling companies to create more volume. This stimulates growth in the economy, which offsets the cost of decreasing tax rates and ultimately raises government tax revenue.

Detailed explanation-2: -Supply-side economics aims to bolster an economy by implementing policies that will lead to an increased supply of goods and services and subsequent economic growth such as: Reducing corporate income tax rates to provide companies with more cash for reinvestment.

Detailed explanation-3: -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-4: -According to supply-side economics, consumers will benefit from greater supplies of goods and services at lower prices, and employment will increase. Supply-side fiscal policies are designed to increase aggregate supply, as opposed to aggregate demand, thereby expanding output and employment while lowering prices.

Detailed explanation-5: -Supply side policies are efforts to increase competitiveness and efficiency in the economy. They can include policies such as tax cuts, privatisation, investment in education and more flexible labour markets.