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a reduction in tax rates an increase in the reserve d. Short Answer (6 Explain in your own words why a merit-based immigration and labor significantly help increase US Discuss the difference an example of each. automatic stablliers vs. discretionary policies in your own words ard Explain in your own words what non-tariff barriers are, what they are used for, and give examples of non- tariff barriers. What will Grece import?
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Question 1. Option C. A reduction in tax rates.

Explanation: Supply-side economists target at stimulating the aggregate supply in order to increase real output. In stagflation, the inflation rate is high and the economy slows down. Reducing tax rates increases the profits of firms as their costs come down. Therefore, firms produce more and the lower costs of firms results in a lower price of goods and services.

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