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Farmers in developing countries claim that the United States [#permalink]
 19 Mar 2008, 01:38
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Farmers in developing countries claim that the United States government, through farm subsidies, is responsible for the artificially low global price of wheat. Because the U.S. government buys whatever wheat American farmers are unable to sell on the open market, American farmers have no incentive to modulate the size of their crops according to the needs of the global market. As a result, American farmers routinely produce more wheat than the global market can absorb and the global price of wheat is kept low. Without these subsidies, the farmers in developing economies claim, American farmers would produce only the amount of wheat that they could sell on the open market and the global price of wheat would rise.
Which of the following, if true, most weakens the claims of the farmers in developing countries regarding the price of wheat?
A Wheat that is not processed for consumption is often used for certain industrial applications.
B Non-governmental buyers of wheat and wheat products are able to predict how much wheat they will need several years in advance.
C The United States government offers similar subsidies to soybean farmers, though the global price of soybeans is significantly higher than that of wheat.
D Other countries, such as Canada and Russia, are likely to produce more wheat if the United States were to reduce its output.
E The price of sorghum, a crop for which the United States government offers no subsidies, is lower than that of wheat.
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Re: CR - Wheat Subsidy [#permalink]
19 Mar 2008, 02:15
maverick101 wrote: Farmers in developing countries claim that the United States government, through farm subsidies, is responsible for the artificially low global price of wheat. Because the U.S. government buys whatever wheat American farmers are unable to sell on the open market, American farmers have no incentive to modulate the size of their crops according to the needs of the global market. As a result, American farmers routinely produce more wheat than the global market can absorb and the global price of wheat is kept low. Without these subsidies, the farmers in developing economies claim, American farmers would produce only the amount of wheat that they could sell on the open market and the global price of wheat would rise.
Which of the following, if true, most weakens the claims of the farmers in developing countries regarding the price of wheat?
A Wheat that is not processed for consumption is often used for certain industrial applications.
B Non-governmental buyers of wheat and wheat products are able to predict how much wheat they will need several years in advance.
C The United States government offers similar subsidies to soybean farmers, though the global price of soybeans is significantly higher than that of wheat.
D Other countries, such as Canada and Russia, are likely to produce more wheat if the United States were to reduce its output.
E The price of sorghum, a crop for which the United States government offers no subsidies, is lower than that of wheat. I think E, correct me if I am wrong! E means that NO SUBSIDIES, THE PRICE IS STILL LOW, EVEN LOWER THAN..."
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Re: CR - Wheat Subsidy [#permalink]
19 Mar 2008, 07:27
Yes I think it's E for the same reason. To weaken the claim that without subsidies the price will rise, we have to show that without the subsidies the price will not rise or is lower. That's exactely what E says.
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Re: CR - Wheat Subsidy [#permalink]
19 Mar 2008, 07:45
D...Without these subsidies, the farmers in developing economies claim, American farmers would produce only the amount of wheat that they could sell on the open market and the global price of wheat would rise. Which of the following, if true, most weakens the claims of the farmers in developing countries regarding the price of wheat? We need to find a factor that decrease the price of wheat.D. Other countries, such as Canada and Russia, are likely to produce more wheat if the United States were to reduce its output. - more wheat - less price.Guys, can you explain how we can compare in E the price of sorghum and the price of wheat??? If you exchange sorghum for computers, for instance, the option E is definitely out of scope. Moreover, we have lower/higher rather than decrease/increase in E.
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Re: CR - Wheat Subsidy [#permalink]
19 Mar 2008, 09:46
maverick101 wrote: Farmers in developing countries claim that the United States government, through farm subsidies, is responsible for the artificially low global price of wheat. Because the U.S. government buys whatever wheat American farmers are unable to sell on the open market, American farmers have no incentive to modulate the size of their crops according to the needs of the global market. As a result, American farmers routinely produce more wheat than the global market can absorb and the global price of wheat is kept low. Without these subsidies, the farmers in developing economies claim, American farmers would produce only the amount of wheat that they could sell on the open market and the global price of wheat would rise.
Which of the following, if true, most weakens the claims of the farmers in developing countries regarding the price of wheat?
A Wheat that is not processed for consumption is often used for certain industrial applications.
B Non-governmental buyers of wheat and wheat products are able to predict how much wheat they will need several years in advance.
C The United States government offers similar subsidies to soybean farmers, though the global price of soybeans is significantly higher than that of wheat.
D Other countries, such as Canada and Russia, are likely to produce more wheat if the United States were to reduce its output.
E The price of sorghum, a crop for which the United States government offers no subsidies, is lower than that of wheat. I guess D makes sense. they are arguing that the low price is because of over production that is because of subsidies. So D directly says the same thing.
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Re: CR - Wheat Subsidy [#permalink]
19 Mar 2008, 17:46
i went for D
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Re: CR - Wheat Subsidy [#permalink]
19 Mar 2008, 20:03
D for me as well.
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Re: CR - Wheat Subsidy [#permalink]
19 Mar 2008, 20:31
GMAT TIGER wrote: maverick101 wrote: Farmers in developing countries claim that the United States government, through farm subsidies, is responsible for the artificially low global price of wheat. Because the U.S. government buys whatever wheat American farmers are unable to sell on the open market, American farmers have no incentive to modulate the size of their crops according to the needs of the global market. As a result, American farmers routinely produce more wheat than the global market can absorb and the global price of wheat is kept low. Without these subsidies, the farmers in developing economies claim, American farmers would produce only the amount of wheat that they could sell on the open market and the global price of wheat would rise.
Which of the following, if true, most weakens the claims of the farmers in developing countries regarding the price of wheat?
A Wheat that is not processed for consumption is often used for certain industrial applications.
B Non-governmental buyers of wheat and wheat products are able to predict how much wheat they will need several years in advance.
C The United States government offers similar subsidies to soybean farmers, though the global price of soybeans is significantly higher than that of wheat.
D Other countries, such as Canada and Russia, are likely to produce more wheat if the United States were to reduce its output.
E The price of sorghum, a crop for which the United States government offers no subsidies, is lower than that of wheat. I guess D makes sense. they are arguing that the low price is because of over production that is because of subsidies. So D directly says the same thing. @Gmattiger, I will attack your reasoning to show that D strengthens the claim rather than weakens it. hi hi  Your reasoning can be restated as: susidies --> over production --> low price From this chain, you can strenthen it by showing that either over production --> low price , or susidies ---> low price. : @Walker, It is Ok as long as you can show that NO SUBSIDIES, THE PRICE STILL LOW.
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Re: CR - Wheat Subsidy [#permalink]
19 Mar 2008, 21:46
sondenso wrote: @Walker, It is Ok as long as you can show that NO SUBSIDIES, THE PRICE STILL LOW. The passage: no [subsidies] --> ( Assumption: all other suppliers will keep their supply at constant rate and demand is constant) ---> decline [supply] --> rise [price] D actually weakens the assumption.
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Re: CR - Wheat Subsidy [#permalink]
19 Mar 2008, 21:56
sondenso wrote: GMAT TIGER wrote: maverick101 wrote: Farmers in developing countries claim that the United States government, through farm subsidies, is responsible for the artificially low global price of wheat. Because the U.S. government buys whatever wheat American farmers are unable to sell on the open market, American farmers have no incentive to modulate the size of their crops according to the needs of the global market. As a result, American farmers routinely produce more wheat than the global market can absorb and the global price of wheat is kept low. Without these subsidies, the farmers in developing economies claim, American farmers would produce only the amount of wheat that they could sell on the open market and the global price of wheat would rise.
Which of the following, if true, most weakens the claims of the farmers in developing countries regarding the price of wheat?
A Wheat that is not processed for consumption is often used for certain industrial applications.
B Non-governmental buyers of wheat and wheat products are able to predict how much wheat they will need several years in advance.
C The United States government offers similar subsidies to soybean farmers, though the global price of soybeans is significantly higher than that of wheat.
D Other countries, such as Canada and Russia, are likely to produce more wheat if the United States were to reduce its output.
E The price of sorghum, a crop for which the United States government offers no subsidies, is lower than that of wheat. I guess D makes sense. they are arguing that the low price is because of over production that is because of subsidies. So D directly says the same thing. @Gmattiger, I will attack your reasoning to show that D strengthens the claim rather than weakens it. hi hi Your reasoning can be restated as: susidies --> over production --> low price From this chain, you can strenthen it by showing that either over production --> low price , or susidies ---> low price. : @Walker, It is Ok as long as you can show that NO SUBSIDIES, THE PRICE STILL LOW. i do not understand how does that weakens. overproduction in the US - world wide wheat price low. if US stops subsidies - US production reduces but the reduction is complimented by Canadian and Russian production - so the world-wide supply of wheat remains unaffected - then no increase in the wheat price. C and D are traps because they are comparing the prices --- so they are out of scope.
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Re: CR - Wheat Subsidy [#permalink]
19 Mar 2008, 22:21
GMAT TIGER wrote: C and D are traps because they are comparing the prices --- so they are out of scope. I guess you'd like to say "C and E" 
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Re: CR - Wheat Subsidy [#permalink]
19 Mar 2008, 23:37
walker wrote: GMAT TIGER wrote: C and D are traps because they are comparing the prices --- so they are out of scope. I guess you'd like to say "C and E" oh yeah obviously thanks... 
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Re: CR - Wheat Subsidy [#permalink]
20 Mar 2008, 00:37
@Gmattiger and Walker, thanks all of you. Although OA is still not be shown, I think I am convinced!  C.U in the next CRs
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Re: CR - Wheat Subsidy [#permalink]
20 Mar 2008, 12:39
Just to close the discussion. D was it.
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Re: CR - Wheat Subsidy
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20 Mar 2008, 12:39
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