Question

In: Economics

In most regards, supply-side economics and Keynesian economics are __________.

In most regards, supply-side economics and Keynesian economics are __________.


A.

closely associated

B.

complementary


C.

opposites


D.nearly identical


Solutions

Expert Solution

Opposite

The supply-side theory is typically held in stark contrast to Keynesian theory which, among other facets, includes the idea that demand can falter, so if lagging consumer demand drags the economy into recession, the government should intervene with fiscal and monetary stimuli.

While Keynesian economics uses government to change aggregate demand with the encouragement to increase or decrease demand and output, supply-side economics tries to increase economic growth by increasing aggregation supply with tax cuts.

Please rate my answer

Rahul Sunny answered 1 year ago
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