Can anyone simplify the explanation for this question?
The answer is (C).
It is Keynesian economics.
If the government takes $100 from Peter1 and gives it to Paul1, that leads to growth because the government `spends’ all of Peter1’s money when it gives the money to Paul1, but Peter1 would not have spent all of his money had it not been taken off him.
I suppose by that logic, if the government took $100 from Peter1 and then gave it back to him, that would cause growth as well.