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Supply side policy

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Question 16

An economy is currently operating at full capacity on its production possibility frontier (PPF). Which of the following is most likely to enable the economy to achieve a sustained increase in its maximum potential output?

An increase in government funding for national worker training programmes

A reduction in income tax rates to stimulate domestic consumer demand

A reallocation of existing resources from agricultural production to manufacturing

An expansion of the money supply by the central bank

Supply side policy Questions

  1. A Level
  2. /Economics
  3. /Supply side policy