If the U.S. Congress passes legislation to raise taxes to control demand-pull inﬂation, then this would be an example of a(n)

Question

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Raising taxes to control demand-pull inflation reduces disposable income and decreases consumer spending, leading to a decrease in aggregate demand. This is an example of contractionary fiscal policy, aimed at reducing inflationary pressures on the economy.

If the US Congress Passes Legislation to Raise Taxes to Control Demand-Pull