" governments tend to focus on supply side fiscal picy to encourage economic growth during a...

" governments tend to focus on supply side fiscal picy to encourage economic growth during a period like the covid 19 pandemic "

do you agree with the statement ? explain what is fiscal policy and the supply side effects in your responce ?

Expert Solution

Yes. During a situation like a pandemic, government tends to focus on supply side of a fiscal policy .

Fiscal policy is a measure taken by the government to correct economic imbalances caused by contractionary trend and bring the economy closer to equilibrium. During recession, fiscal policy Would undertake expansionary measures like tax cuts and increase in government spending.

supply-side fiscal policy, often focus on cutting taxes, lowering borrowing rates, and deregulating industries to foster increased production. This has a trickle down effect. Industries would be enabled to invest more and employ more workers, who would get money that they spend, thus sending the economy moving towards expansionary trend.

Rahul Sunny answered 2 years ago

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" governments tend to focus on supply side fiscal picy to encourage economic growth during a...

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