Policies used to reduce a balance of payments deficit are divided into two groups: expenditure-dampening policies and expenditure-switching policies. Which pair of policies is classified correctly?
- Aexpenditure-dampening policy: an increase in the rate of income tax; expenditure-switching policy: devaluation of the currency
- Bexpenditure-dampening policy: an increase in the rate of value added tax; expenditure-switching policy: the imposition of import quotas
- Cexpenditure-dampening policy: devaluation of the currency; expenditure-switching policy: an increase in the rate of value added tax
- Dexpenditure-dampening policy: the imposition of import quotas; expenditure-switching policy: an increase in the rate of income tax