Florida US History EOC Practice Exam

The economic policy associated with Ronald Reagan's presidency is supply-side economics. This approach is based on the idea that reducing taxes and decreasing regulation can stimulate economic growth. Advocates of supply-side economics argue that when individuals and businesses have more capital available, they will invest and spend more, leading to increased production, job creation, and overall economic expansion.

During Reagan's administration, significant tax cuts were implemented, which aimed to boost economic activity by allowing people to keep more of their income. This was part of a broader economic strategy called "Reaganomics," which also included trimming government spending and reducing regulatory barriers. The belief was that these measures would ultimately lead to higher revenue through increased economic activity, thus countering some of the potential downsides of reduced tax rates.

In contrast, Keynesian economics focuses on the idea that government spending is a primary driver of economic activity, particularly during recessions, which was not the core tenet of Reagan's approach. Monetarism emphasizes the role of government in controlling the supply of money to manage the economy, while welfare economics deals with the allocation of resources to improve social welfare — both of which do not directly encapsulate the supply-side focus of Reagan's policies.