Question 1
What effect will a successful supply-side policy have on the aggregate demand curve?
◦ Movement down along
◦ Movement up along
◦ Rightward shift
◦ Leftward shift
Question 2
Which of the following beneficial supply-side effects is NOT claimed to occur following cuts in the marginal rate of income tax?
◦ Employment rises.
◦ More people wish to work.
◦ Both equilibrium and disequilibrium unemployment fall even when wage rates are inflexible downwards.
◦ None of the above