81.What did supply-side economics argue was the real problem with the U.S. economy and what was its prescription?
82.Draw the Laffer Curve and explain its shape.
83.Explain what would happen to tax revenue if policy makers cut tax rates while existing rates are above the bend in the Laffer Curve. Why does this happen?
84.Use the Economics in Practice titled “How are Expectations Formed?” to answer the following question. What are the two factors that the British economists discovered are important in how consumers form inflationary expectations? What does this suggest vis-à-vis concerning what economics theorists believe to be true about how consumers form their expectations?
85.Critics of supply-side theory say that cuts in tax rates may not necessarily raise tax revenue. What is their argument?
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