Supply-side fiscal policy involves the use of: Choose one:
A. monetary policy to supplement traditional fiscal policy.
B. government spending and taxes to affect the net exports side of the economy.
C. government spending and taxes to affect the aggregate demand curve.
D. government spending and taxes to affect the production side of the economy.
E. government spending and taxes to affect the consumption side of the economy.

Respuesta :

Answer:

D. government spending and taxes to affect the production side of the economy.

Explanation:

Supply-side fiscal policy aims at improving the economic conditions of the firms in an economy, because according to this economic theory, firms are  the basis of economic growth.

A supply-side fiscal policy would involve corporate tax cuts, in order to promote higher investment that eventually result in more production, and a higher supply of goods and services.

It could also involve government spending that helps companies increase production, for example: spending on infraestructure to improve logistics, or spending on education to improve human capital.