Supply-side policy boosts long-run growth via production incentives

Steps:

• Identify supply-side policy aims: enhance productive capacity for sustainable economic growth.
• Match aims to options: economic growth aligns as primary target.
• Evaluate measures: deregulation reduces business costs, directly supporting supply-side goals.
• Eliminate mismatches: other options link demand-side or unrelated aims/measures.

Why A is correct:

• Supply-side policy targets economic growth by removing barriers to production; deregulation lowers regulatory burdens, increasing efficiency per economic theory.

Why the others are wrong:

• B: Full employment is a demand-side goal; increasing money supply is expansionary monetary policy, not supply-side.
• C: Income equality focuses on redistribution; progressive taxation adjusts demand distribution, opposing supply-side incentives.
• D: Stable prices targets inflation; decreasing interest rates is demand-management via monetary policy.

Final answer: A