If inflation is the most significant issue in the economy, an appropriate fiscal policy response would be to decrease taxation.

Name: If inflation is the most significant issue in the economy, an appropriate fiscal policy response would be to decrease taxation.
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Decreasing taxation would increase the amount of money in circulation, which could contribute to inflation. In order to combat inflation, a more appropriate fiscal policy response would be to increase taxation or decrease government spending.

If Inflation Is the Most Significant Issue in the Economy