Which of the following is correct?
A)The Continental Congress used the inflation tax to help finance the American Revolution.
B)The inflation is today a principal source of revenue for the U.S.government.
C)There is no way a person can avoid the inflation tax.
D)Governments can only raise revenues through taxation.

Question

Quizplus · Accepted Answer

This choice is correct as the Continental Congress did use the inflation tax to finance the American Revolution by printing more money, which led to inflation.

Answer: C
 This choice is correct as it is not possible for an individual to avoid the inflation tax as it is a result of the general rise in prices of goods and services caused by inflation, which affects everyone.

Answers B and D are not correct as they are both false statements. Inflation is not a principal source of revenue for the U.S government and there are other ways governments can raise revenue besides taxation, such as borrowing or selling assets.

Which of the Following Is Correct