Question

10. Which of the following policy is correct to
control inflation?
(1 Point)
a. Increase in unproductive
expenditure
O b. Increase in indirect taxes
O c. Increase in direct taxes
d. Increase in deficit financing​

Answer 1

Explanation:

❥︎Aɴsᴡᴇʀ☟︎︎︎

Inflation is a period of rising prices. Other policies to reduce inflation can include tight fiscal policy (higher tax), supply-side policies, wage control, appreciation in the exchange rate and control of the money supply. ... (a form of monetary policy).

Answer 2

Option c is the correct answer.

Increase in direct taxes is the correct policy to control inflation.

1. Inflation is the rise in general price level.
2. It is due to excess demand or increased money supply that results in the situation of inflationary pressure in the economy.
3. The increase in direct taxes will compel the consumers to reduce their consumption demand this will decrease the aggregate demand.