An Economy Is Experiencing a High Rate of Inflation

question 213

Multiple Choice

An economy is experiencing a high rate of inflation.The government wants to reduce consumption by $36 billion to reduce inflationary pressure.The MPC is 0.75.By how much should the government raise taxes to achieve its objective?

• A)$6 billion
• B)$9 billion
• C)$12 billion
• D)$16 billion

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Definitions:

Tobacco Smoke

The smoke that comes from burning tobacco products, such as cigarettes and cigars, containing harmful substances.

Upper Body Discomfort

A general term that refers to any form of pain or unease located in the torso or arms of the body.

Cold Sweat

A perspiration that occurs without physical heat or exertion, often as a result of fear, stress, or medical condition.

Nausea

A stomach distress with the urge to vomit, often a precursor to vomiting.