In Which Situation Does Inflation Reduction Have the Lowest Cost

question 123

Multiple Choice

In which situation does inflation reduction have the lowest cost?

• A) when the efforts are credible, so that the sacrifice ratio is low
• B) when the efforts are credible, so that the sacrifice ratio is high
• C) when the efforts are unexpected, so that the sacrifice ratio is high
• D) when the efforts are unexpected, so that the sacrifice ratio is low

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Definitions:

Pretax Income

The amount of income earned by a business before any taxes are deducted.