17. With Proposition 13, if you bought your house 11 years : GMAT Reading Comprehension (RC)
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# 17. With Proposition 13, if you bought your house 11 years

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17. With Proposition 13, if you bought your house 11 years [#permalink]

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23 Jul 2007, 02:52
17. With Proposition 13, if you bought your house 11 years ago for $75,000, your property tax would be approximately$914 a year (1 percent of $75,000 increased by 2 percent each year for 11 years); and if your neighbor bought an identical house next door to you for$200,000 this year, his tax would be $2,000 (1 percent of$200,000). Without Proposition 13, both you and your neighbor would pay $6,000 a year in property taxes (3 percent of$200,000).
Which of the following is the conclusion for which the author most likely is arguing in the passage above?

(A) Proposition 13 is unconstitutional because it imposes an unequal tax on properties of equal value.
(B) If Proposition 13 is repealed, every homeowner is likely to experience a substantial increase in property taxes.
(C) By preventing inflation from driving up property values, Proposition 13 has saved homeowners thousands of dollars in property taxes.
(D) If Proposition 13 is not repealed, identical properties will continue to be taxed at different rates.
(E) Proposition 13 has benefited some homeowners more than others.

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23 Jul 2007, 05:15
(A) Passage doesn't dicuss what is constitutional.
(C) Out. The proposition doesn't curb inflation, it just taxes at the homeowner at the property price paid
(D) Both properties are taxed at the same rate - 1% of property value

Down to B and E. B appears to be stronger. Every homeowner will experience an increase in property tax is the proposition is repealed. E is weaker as we are not sure exactly if there are more homeowners who paid a higher property price or more homeowners who paid a lower property price.
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23 Jul 2007, 07:36
Quote:
17. With Proposition 13, if you bought your house 11 years ago for $75,000, your property tax would be approximately$914 a year (1 percent of $75,000 increased by 2 percent each year for 11 years); and if your neighbor bought an identical house next door to you for$200,000 this year, his tax would be $2,000 (1 percent of$200,000). Without Proposition 13, both you and your neighbor would pay $6,000 a year in property taxes (3 percent of$200,000).
Which of the following is the conclusion for which the author most likely is arguing in the passage above?

(A) Proposition 13 is unconstitutional because it imposes an unequal tax on properties of equal value.
(B) If Proposition 13 is repealed, every homeowner is likely to experience a substantial increase in property taxes.
(C) By preventing inflation from driving up property values, Proposition 13 has saved homeowners thousands of dollars in property taxes.
(D) If Proposition 13 is not repealed, identical properties will continue to be taxed at different rates.
(E) Proposition 13 has benefited some homeowners more than others.

I'm going to go with E. I agree with ywilfred that the passage says nothing about the legality of the proposition, so A is out.

I don't like B because not every homeowner will experience the substantial increases, only those who have not recently bought their homes.

I don't like C because the passage mentions nothing about property values in relation to inflation.

I agree with ywilfred again that D is bad because they are being taxed at the same rate, just on different amounts (although that one was tricky, If I hadn't read it carefully, I might have chosen D)
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23 Jul 2007, 12:12
I go for B
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24 Jul 2007, 06:56
dahcrap wrote:
I go for B

Yah right...

Simply enough:

- With Proposition 13, one pays $914 per year, one pays$2,000 per year.
- Without Proposition 13, both pay \$6,000 per year.
24 Jul 2007, 06:56
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