4
practice examMultiple Choice

Practice Exam

Question 4 • US History Studies Since 1877

According to Reagan’s supply-side economics, the first step to triggering the cycle of growth was

Answer
A
regulating businesses.
B
raising taxes.
C
creating government programs.
D
reducing taxes.

Explanation

Reagan’s supply-side approach argued that reducing taxes would encourage people and businesses to work, invest, and produce more. That increased economic activity was expected to lead to growth, so the first step was reducing taxes.

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