A fiscal policy cure for inflation includes:
A) Patience.
B) An increase in the reserve requirement.
C) A reduction in tax rates for corporations and households.
D) A decrease in government spending.

Question

Quizplus · Accepted Answer

A decrease in government spending would lead to a decrease in the demand for goods and services, which would help to control inflation by reducing the pressure on prices. Choices A, B, and C would likely have little to no effect on inflation.

A Fiscal Policy Cure for Inflation Includes