The View Held by Arthur Laffer and Ronald Reagan That

question 35

Multiple Choice

The view held by Arthur Laffer and Ronald Reagan that cuts in tax rates would encourage people to increase the quantity of labor they supplied became known as

• A)California economics.
• B)welfare economics.
• C)supply-side economics.
• D)elasticity economics.

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Definitions:

Freely Flexible Exchange Rates

An exchange rate system in which the value of currencies are determined by the open market and subject to the forces of supply and demand without direct intervention by central banks.

American Trade Deficit

occurs when the total amount of goods and services the United States imports exceeds the amount it exports, leading to a net outflow of domestic currency to foreign markets.

Foreign Exchange Rate

The price of one currency in terms of another.

Exchange Rate

The value of one currency for the purpose of conversion to another.