Fearing that the economy was overheating, policymakers instituted a temporary tax surcharge in 1968. This temporary surtax

Question

Quizplus · Accepted Answer

The passage states that policymakers instituted a temporary tax surcharge in 1968 because they feared the economy was overheating. This suggests that the economy was growing too quickly and needed to be slowed down. The fact that the surtax was temporary indicates that policymakers did not want to permanently change the tax structure, but rather wanted to impose a short-term measure to reduce economic growth. The passage also indicates that the surtax reduced savings but had little effect on consumption. This suggests that people continued to spend money despite the higher taxes, but may have reduced their savings in response to the tax increase. Therefore, option B is the best choice as it accurately summarizes the information given in the passage.

Fearing That the Economy Was Overheating, Policymakers Instituted a Temporary