Final answer:
The Economic Recovery and Tax Act of 1981 was designed to stimulate business activity and reduce federal revenue by cutting taxes, not to provide more funds for social welfare programs. The correct answer is option (c).
Step-by-step explanation:
The Economic Recovery and Tax Act of 1981 introduced by President Reagan had several objectives but providing more funds for social welfare programs was not one of them. Instead, the Act sought to stimulate business activity by reducing tax rates for individuals and corporations, thereby putting more money in the hands of consumers and incentivizing investment.
It posited that tax cuts for wealthy Americans would stimulate economic growth through increased investment and innovation. Although predicting a boom in economic activity that would balance the budget, the tax cuts actually reduced federal revenue significantly, leading to budget deficits.
Reagan did initially propose cuts to social welfare programs like Social Security and Medicare, but these were met with public outrage and largely reversed. Thus, the correct answer is (c) provide more funds for social welfare programs.