Post Utme Coal City University 2023 Economics Question 20

Practice objective / multiple choice question 20 from the 2023 Post Utme Coal City University Economics examination.

Post Utme Coal City University 2023 Economics Objective / Multiple Choice
Question 20 POST_UTME_COAL_CITY_UNIVERSITY • 2023 • ECONOMICS • objective

The government of Nigeria uses the following fiscal policy tools to control inflation: (a) Taxation, (b) Government Exp\enditure, (c) both of the above, and (d) neither of the above. Which of the following is NOT a correct statement about the effect of taxation on inflation?

Answer Options

A. Taxation reduces the money supply, which leads to lower inflation.
Correct Answer B. Taxation increases the money supply, which leads to higher inflation.
C. Taxation has no effect on inflation.
D. Taxation increases interest rates, which leads to lower inflation.
Correct Answer
B
Correct Option:
Taxation increases the money supply, which leads to higher inflation.

About This Question

This is Post Utme Coal City University 2023 Economics Question 20. It is one of the objective questions from the 2023 Post Utme Coal City University Economics examination.

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