A government cuts the rate of income tax paid by workers. Which of the following best explains why some people may then choose to work, or to work longer hours?
Firms pay less tax on their profits, so they can offer higher wages
Consumer spending rises, so firms want to employ more workers
The government collects more tax revenue to fund new jobs
Workers keep more of what they earn from each extra hour of work
121 exam-style questions on OCR GCSE Economics 3.7 Supply side policies, covering 3.7.1 What are supply side policies and 3.7.2 Costs and benefits of supply side policies. Each one has a worked solution and a mark scheme showing where the marks go.