Supply Side Policy

Question 1

What are the example of free market supply side policies?

Answer 1

Tax cuts

Privatisation

Deregulation

Labour market reforms

Question 2

How does tax cuts increase productive capacity ?

Answer 2

Makes work more rewarding , increasing incentive to be economically active , increasing labour force , thus increasing productive capacity

Question 3

Tax cuts evaluative points

Answer 3

People who are economically inactive aren’t financially incentivised

Question 4

Privatisation

Answer 4

Profit incentive increases likelihood of investment increasing capital and stock

Question 5

Ep privatisation

Answer 5

Dividends comes from profit not investment

Question 6

Deregulation

Answer 6

increases profibity of productivity and incentive to build stock increasing capital and stock

Question 7

Deregulation EP

Answer 7

Business confidence

Question 8

Labour market reforms

Answer 8

Cant appose changes to work , easier for firms to boost productivity and produce more with resources

Question 9

Ep labour market reforms

Answer 9

Workers may quit

Poor conditions means less productivity