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In the 1970's there was an oversupply of college graduates.

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In the 1970's there was an oversupply of college graduates. [#permalink] New post 09 Dec 2010, 13:22
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. In the 1970's there was an oversupply of college
graduates. The oversupply caused the average
annual income of college graduates to fall to a level
only 18 percent greater than that of workers with
only high school diplomas. By the late 1980's the
average annual income of college graduates was 43 percent higher than that of workers with only high school diplomas, even though between the 1970's
and the late 1980's the supply of college graduates
did not decrease.

Which of the following, if true in the late 1980's,
best reconciles the apparent discrepancy described
above?
(A) The economy slowed, thus creating a decreased
demand for college graduates.
(B) The quality of high school education improved.
(C) Compared to the 1970's, a greater number of
high schools offered vocational guidance
programs for their students.
(D) The proportion of the population with at least a
college-level education increased.
(E) There was for the first time in 20 years an over-
supply of job seekers with only high school
diplomas.

what is wrong with choice A
[Reveal] Spoiler: OA

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Re: In the 1970's there was an oversupply of college graduates [#permalink] New post 09 Dec 2010, 22:33
in A it says that the economy slowed in 1980, therefore it should of cause the decrease in salaries rather than increase.
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Re: In the 1970's there was an oversupply of college graduates [#permalink] New post 10 Dec 2010, 08:13
kt00381n wrote:
in A it says that the economy slowed in 1980, therefore it should of cause the decrease in salaries rather than increase.


Agree with this.

Should be E
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Re: In the 1970's there was an oversupply of college graduates [#permalink] New post 11 Dec 2010, 10:33
This questions plays the trick with percentages and absolute figures .

Lets assume that the amount college graduates used to get has not increased (owing to the fact that the supply of college graduates did not decrease) . How do we then explain the increasing % gap . That could only be explained if the salary of workers with only high schools diploma decreases and E happens to reconcile these facts.

If the number of job seekers with only high school diplomas are swarming the city , then obviously their income will fall down(yeah...its again an assumption).

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Re: In the 1970's there was an oversupply of college graduates [#permalink] New post 28 Sep 2011, 09:01
ajit257 wrote:
. In the 1970's there was an oversupply of college
graduates. The oversupply caused the average
annual income of college graduates to fall to a level
only 18 percent greater than that of workers with
only high school diplomas. By the late 1980's the
average annual income of college graduates was 43 percent higher than that of workers with only high school diplomas, even though between the 1970's
and the late 1980's the supply of college graduates
did not decrease.

Which of the following, if true in the late 1980's,
best reconciles the apparent discrepancy described
above?
(A) The economy slowed, thus creating a decreased
demand for college graduates.
(B) The quality of high school education improved.
(C) Compared to the 1970's, a greater number of
high schools offered vocational guidance
programs for their students.
(D) The proportion of the population with at least a
college-level education increased.
(E) There was for the first time in 20 years an over-
supply of job seekers with only high school
diplomas.

what is wrong with choice A



Why not A? Because when the demand decreases, the price decreases.
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Re: In the 1970's there was an oversupply of college graduates [#permalink] New post 29 Sep 2011, 01:31
lawsohn wrote:
ajit257 wrote:
. In the 1970's there was an oversupply of college
graduates. The oversupply caused the average
annual income of college graduates to fall to a level
only 18 percent greater than that of workers with
only high school diplomas. By the late 1980's the
average annual income of college graduates was 43 percent higher than that of workers with only high school diplomas, even though between the 1970's
and the late 1980's the supply of college graduates
did not decrease.

Which of the following, if true in the late 1980's,
best reconciles the apparent discrepancy described
above?
(A) The economy slowed, thus creating a decreased
demand for college graduates.
(B) The quality of high school education improved.
(C) Compared to the 1970's, a greater number of
high schools offered vocational guidance
programs for their students.
(D) The proportion of the population with at least a
college-level education increased.
(E) There was for the first time in 20 years an over-
supply of job seekers with only high school
diplomas.

what is wrong with choice A



Why not A? Because when the demand decreases, the price decreases.


First understand the discrepancy:

Even though the supply of college graduates did not decrease ( stayed same or increased), the average annual income of college graduates increased (18% above high school to 43% above high school). How can this happen? This can only happen when the rates of high school pass outs go down. This happens when High school pass outs supply increase.

Hope this helps. :-D
Re: In the 1970's there was an oversupply of college graduates   [#permalink] 29 Sep 2011, 01:31
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