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Prior works on the hidden terminal problem in wireless networks often assume that the SNR requirement and the transmission range in a networks are fixed. In fact they are rate dependent. Because of this assumption many of the prior conclusions about the hidden terminal are not accurate. A new analysis of the hidden terminal problem is presented in the paper. The new insights provided by the analysis lead to a IG-MAC scheme for tackling the hidden terminal problem in multi rate ad hoc networks. The key point is to model the interference information by means of Interference Graph and send busy tone with encoded communication information to prevent the potentially interfering nodes from initiating new transmissions. Through the simulations our protocol can solve the hidden terminals problem caused by 802.11 and improve the network performance substantially.