Question

Background information: In 2012, President Obama and Congress debated the issue of taxes and tax cuts. In this speech, President Obama is discussing the effects of a potential tax increase.
A typical middle-class family of four would see its income taxes go up by $2,200. That's $2,200 out of people's pockets. That means less money for buying groceries, less money for filling prescriptions, less money for buying diapers. . . .
. . . Businesses can't afford it either. . . . Economists predict that if taxes go up on the middle class next year, consumers will spend nearly $200 billion less on things like cars and clothes and furniture - and that obviously means fewer customers. That cuts into business profits.That makes businesses less likely to invest and hire, which means fewer jobs. And that can drag our entire economy down.
—President Barack Obama,
November 28, 2012
Which statements best communicate the main idea of this speech? Choose three correct answers.
Responses

Higher taxes will have a severe impact on citizens.
Higher taxes will have a severe impact on citizens.

Spending on social needs is a low priority.
Spending on social needs is a low priority.

Increased taxation on the middle class

Answer 1

Correct choices (and why):

1. Higher taxes will have a severe impact on citizens. — The speech stresses a typical middle‑class family would pay $2,200 more and have less money for groceries, prescriptions, diapers, etc.

2. Increased taxation on the middle class will reduce consumer spending and hurt businesses. — Obama cites economists’ estimates that higher middle‑class taxes would cut consumer spending by about $200 billion, which reduces customers and business profits.

3. Higher taxes will lead to fewer jobs and drag the economy down. — The speech links reduced consumer spending and lower business investment to fewer hires and a weaker economy.

The statement "Spending on social needs is a low priority" is not supported by the speech.