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Economies in which a high percentage of resources are

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Economies in which a high percentage of resources are [#permalink] New post 28 Oct 2005, 13:44
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A
B
C
D
E

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Economies in which a high percentage of resources are invested in research and development show greater growth in the long run than do those in which resources are channeled into consumption. Japanese workers spend a higher percentage of their income investing in research and development than do American workers.
To grow as fast as Japan has in the past three decades, the United States must change the tax code in order to encourage savings and investment and discourage debt.
Which of the following, if true, tends to weaken the argument?
(A) Japanese research is more focused on consumers than is research by American firms.
(B) Class mobility, highly valued in American culture, is encouraged by a growing rather than a stagnant economy.
(C) Studies have shown that countries with high consumption rates prosper in the short run.
(D) Proposed changes to the tax code could involve strict limits on the deductability of interest, and increased allowance for research.
(E) Because a decreasing percentage of the United States is under 40, an age when savings are traditionally low, the savings rate will increase without changes to the tax code.

Please explain your ans. From 1000 CR
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 [#permalink] New post 28 Oct 2005, 14:57
I got B.
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 [#permalink] New post 28 Oct 2005, 15:09
On the basis that investing in reasearch and developement leads to a greater growth in the long run, the author argues that it is necessary (must) change the tax code to grow as fast as Japan has done. Here the clue word is must. It introduces the necessity meaning. In order to weaken the argument one have to find some evidence proving that it is not necessary to change the taxt code in order to grow as fast as Japan has done. This evidence is introduced in E.

Last edited by automan on 29 Oct 2005, 04:48, edited 1 time in total.
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 [#permalink] New post 28 Oct 2005, 16:48
Let me go for (E).

The article says that America MUST change the tax code in order to increase savings. However, according to (E), the tax code need not be changed since the savings will increase even without the change of tax code.
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 [#permalink] New post 28 Oct 2005, 16:52
E.

C may or may not fit for US. Also it does not speak about overhauling tax system.
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 [#permalink] New post 28 Oct 2005, 16:54
what is wrong with (D)
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 [#permalink] New post 28 Oct 2005, 17:23
[quote="pavrnd"]what is wrong with (D)[/quote

We should be concerned about tax and not interest.
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 [#permalink] New post 28 Oct 2005, 20:04
D !
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 [#permalink] New post 28 Oct 2005, 21:11
This one is a clear E.

The argument is this - for US to reach heightened levels of R&D, the govt has to induce higher savings by altering the tax code.

So, a weakening statement will be one that provides an alternative way to increase the savings.

E says that as a majority of the US population is above 40 (age where people by default tend to save more), altering tax is not required. Savings will increase, coutesy the demography of the US.

D is wrong as we are not concerned about interest deductability and also D is beyond the scope of the argument.
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 [#permalink] New post 28 Oct 2005, 21:31
no doubt.. E
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 [#permalink] New post 28 Oct 2005, 23:22
E is the answer. What is the OA?
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 [#permalink] New post 30 Oct 2005, 15:01
OA is E
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 [#permalink] New post 31 Oct 2005, 10:55
Is there an OE?
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 [#permalink] New post 31 Oct 2005, 19:44
a) Out of scope
b) Out of scope
c) Out of scope
d) strengthens the argument

e) The correct option. Because the percentatage of the population that is 40 and below is decreasing, implies that the older generation is growing in percentage of the total population. Since the older generation tends to save more money (unfortunately, we have to assume the savings are channeled into funding for R&D), a change in tax code in unneccessary.

I choose E.
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Please help [#permalink] New post 01 Nov 2005, 08:23
Can anybody please direct me to a place where I can download the 1000 cr and the 100 rc files ?

Many thanks....
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 [#permalink] New post 01 Nov 2005, 09:28
Both D and E seem to weaken the argument.

The argument is of the type, x->y and x necessary for y.
i.e., change tax structure -> encourage investment, savings etc
and must change the tax structure.

D weakens by saying x-> ~y i.e., discourages investment in research by creating strict limits on research allowance

E weakens by saying x not a necessary condition for y.

Of the two, D seems to be more strong as it directly opposes the logic while E allows for the possibility that x can cause y.
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 [#permalink] New post 01 Nov 2005, 09:33
E.

Basically what rigger said above. Including the parenthetical note about unfortunately assuming that savings will go towards research and not other things!!
  [#permalink] 01 Nov 2005, 09:33
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