Inflation Sometimes Causes People to Pay ________ Capital Gains Tax

question 13

Multiple Choice

Inflation sometimes causes people to pay ________ capital gains tax than they ought to,________.

• A) less; because tax laws do not typically account for inflation
• B) less; because inflation creates the opportunity for a tax write-off
• C) more; if they neglect to claim the inflation adjustment that tax laws allow
• D) more; because the inflation adjustments in tax laws overcompensate for inflation
• E) more; if much of their calculated profits from selling assets was due to inflation