A Keynesian cure for inflation might include:
A) A decrease in the reserve requirement.
B) An increase in government transfers.
C) A decrease in government regulation of businesses.
D) An increase in tax rates for corporations and households.

Question

Quizplus · Accepted Answer

Keynesian economics suggests that to combat inflation, demand within the economy should be reduced. Increasing tax rates for corporations and households would reduce disposable income, thereby reducing consumption and demand, which can help in controlling inflation.

A Keynesian Cure for Inflation Might Include