Find all School-related info fast with the new School-Specific MBA Forum

 It is currently 04 May 2016, 18:27

### GMAT Club Daily Prep

#### Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

# Events & Promotions

###### Events & Promotions in June
Open Detailed Calendar

# Mayor of town T decided to lower the sales tax in order to

Author Message
TAGS:

### Hide Tags

Intern
Joined: 04 Jul 2006
Posts: 27
Location: Woodland Hills, CA
Followers: 0

Kudos [?]: 0 [0], given: 0

Mayor of town T decided to lower the sales tax in order to [#permalink]

### Show Tags

05 Jul 2006, 08:33
00:00

Difficulty:

(N/A)

Question Stats:

0% (00:00) correct 0% (00:00) wrong based on 0 sessions

### HideShow timer Statictics

13. Mayor of town T decided to lower the sales tax in order to boost the sales volume and therefore increase the budget by eventually receiving more sales tax as the result of the increased sales volume. The mayor wants to follow the example of town J, where such an experiment helped increase the budget twice in a three year term.
Which of the following statements is the best proof that the opponents to the mayor's proposal can use in order to persuade the population of town T not to support this decision?

a. Town J is located very close to the borders of other three states, which causes residents of other states to shop in town J, as the sales taxes in those other states are higher than in this state. Town T is located far from any state border.
b. Town T is not big enough to make the difference of the sales tax received to budget positive as the result of the proposed change.
c. Town J has many more industrial plants that purchase raw materials from the town's mines.
d. This kind of an experiment did not work in any other of the six towns that lowered the sales tax.
e. The mayor is corrupted by several groups of residents of town T. These groups are highly interested in lowering the sales tax as the move will make them much richer.
Manager
Joined: 25 May 2006
Posts: 227
Followers: 1

Kudos [?]: 38 [0], given: 0

### Show Tags

05 Jul 2006, 08:40
I'll go with A, but not 100% sure
_________________

Who is John Galt?

VP
Joined: 14 May 2006
Posts: 1415
Followers: 5

Kudos [?]: 115 [0], given: 0

### Show Tags

05 Jul 2006, 08:54
I think it is A as well

We are comparing town T with town J and in order to make things work the same in town T as in town J those towns have to be similar. in choice A we see that town J is different from town T and thus is a correct choice

A says that town J has borders with other states that have higher taxes, so everyone comes to town J from those states and that is how they get higher profits... Town T, on the other hand, is not said to have borders and is not in the same position, so we can conclude that based on such fact that sales tax reduction might not work, thus should not be supported.
CEO
Joined: 20 Nov 2005
Posts: 2911
Schools: Completed at SAID BUSINESS SCHOOL, OXFORD - Class of 2008
Followers: 20

Kudos [?]: 187 [0], given: 0

### Show Tags

05 Jul 2006, 09:54
Between A and D, I go with A.
_________________

SAID BUSINESS SCHOOL, OXFORD - MBA CLASS OF 2008

Intern
Joined: 11 May 2006
Posts: 18
Followers: 0

Kudos [?]: 0 [0], given: 0

### Show Tags

05 Jul 2006, 10:29
"E" it is.
Option "E" has the argument which can convince the population to oppose the Mayor.
Senior Manager
Joined: 07 Mar 2006
Posts: 352
Followers: 1

Kudos [?]: 23 [0], given: 1

### Show Tags

05 Jul 2006, 12:29
I feel it should be A.
The residents should be happy because of lowering of tax.Why should they be bothered about the volume of sales.Hence i'm eliminating the other choices.
Senior Manager
Joined: 07 Mar 2006
Posts: 352
Followers: 1

Kudos [?]: 23 [0], given: 1

### Show Tags

05 Jul 2006, 12:30
Oops...I meant E.
The above explanation holds good in support of E.
Manager
Joined: 09 Feb 2006
Posts: 90
Location: Prague, CZ
Followers: 1

Kudos [?]: 36 [0], given: 0

### Show Tags

05 Jul 2006, 12:41
I think it should be A.

From my point of view E is wrong, because even when certain group of people becomes richer, it does not necessarily mean that this step won't be beneficial for the town.

What is the OA
CEO
Joined: 20 Nov 2005
Posts: 2911
Schools: Completed at SAID BUSINESS SCHOOL, OXFORD - Class of 2008
Followers: 20

Kudos [?]: 187 [0], given: 0

### Show Tags

05 Jul 2006, 14:10
I believe E can not be the answer. People who have read Arco LSAT may be knowing the term "Ad Hominem" (Attacking the person instead of the problem).
_________________

SAID BUSINESS SCHOOL, OXFORD - MBA CLASS OF 2008

Intern
Joined: 10 Oct 2005
Posts: 23
Followers: 0

Kudos [?]: 2 [0], given: 0

### Show Tags

05 Jul 2006, 15:53
It should be D.

It worked in one town but it failed in 6 towns.
Director
Joined: 26 Sep 2005
Posts: 576
Location: Munich,Germany
Followers: 1

Kudos [?]: 15 [0], given: 0

### Show Tags

05 Jul 2006, 19:58
agree with u2lover's expln. should be A.
SVP
Joined: 30 Mar 2006
Posts: 1737
Followers: 1

Kudos [?]: 60 [0], given: 0

### Show Tags

05 Jul 2006, 21:57
Will go with A.

The mayor is proposing that a reduced sales tax will increase the sales.
B is a close choice but when you look carefully, the population of the town doesnot matter. Increased sales can be due to various other reasons like people buying more, people from other town buying.

the former is illustrated in A. basically it attributes the increased sales to the buying of goods by people from other states. Hence comparing town T with town J would be fallcious as the circumstances are different
Manager
Joined: 31 Mar 2006
Posts: 162
Followers: 1

Kudos [?]: 17 [0], given: 0

### Show Tags

06 Jul 2006, 02:59
What is wrong with D..
Intern
Joined: 21 May 2005
Posts: 20
Location: Los Angles
Followers: 0

Kudos [?]: 0 [0], given: 0

Re: GMAT Club CR Series #13: Mayor of Town T [#permalink]

### Show Tags

06 Jul 2006, 06:07
A is the best choice.
Senior Manager
Joined: 06 Jul 2004
Posts: 473
Location: united states
Followers: 1

Kudos [?]: 58 [0], given: 0

### Show Tags

06 Jul 2006, 11:42
I will go with B.

the only thing that matters to people is how the change in sales tax would affect the budget in their own state. whatever happenned in other state may or may not happen in this particular state. So, if the state is not big enough, the increase in sales might not be sufficient enough to raise more number of sales tax dollars. This would defeat the purpose.\

what is OA guys?
_________________

for every person who doesn't try because he is
afraid of loosing , there is another person who
keeps making mistakes and succeeds..

Director
Joined: 06 May 2006
Posts: 780
Followers: 3

Kudos [?]: 25 [0], given: 0

### Show Tags

06 Jul 2006, 13:53
A, I think.

We need to find something dissimilar b/w the towns T and J to weaken this argument. Only A and C stand.

Since C mentions industrial plants within town, I would not expect a significant rise in sales volume from here... So A.
VP
Joined: 25 Nov 2004
Posts: 1493
Followers: 6

Kudos [?]: 69 [0], given: 0

Re: GMAT Club CR Series #13: Mayor of Town T [#permalink]

### Show Tags

06 Jul 2006, 14:10
TestWriter wrote:
13. Mayor of town T decided to lower the sales tax in order to boost the sales volume and therefore increase the budget by eventually receiving more sales tax as the result of the increased sales volume. The mayor wants to follow the example of town J, where such an experiment helped increase the budget twice in a three year term.

Which of the following statements is the best proof that the opponents to the mayor's proposal can use in order to persuade the population of town T not to support this decision?

a. Town J is located very close to the borders of other three states, which causes residents of other states to shop in town J, as the sales taxes in those other states are higher than in this state. Town T is located far from any state border.

b. Town T is not big enough to make the difference of the sales tax received to budget positive as the result of the proposed change.

the strong reason not to persue the same plan as the town J has would be B. but the question is asking for a proof, which is A not B. B is just an opinion.
Senior Manager
Joined: 06 Jul 2004
Posts: 473
Location: united states
Followers: 1

Kudos [?]: 58 [0], given: 0

### Show Tags

06 Jul 2006, 17:24
town T should be able to generate more number of sales tax dollar on its own. If shoppers from other states or towns also shop in town T as a result, that would increase the tax revenue for town T. But the policy can't be formulated/negated based on the shoppers of other states. That's why I think the answer should be B.

can we now have the OA and OE please?
_________________

for every person who doesn't try because he is
afraid of loosing , there is another person who
keeps making mistakes and succeeds..

Intern
Joined: 04 Jul 2006
Posts: 27
Location: Woodland Hills, CA
Followers: 0

Kudos [?]: 0 [0], given: 0

### Show Tags

07 Jul 2006, 00:51
a. Provides a reasonable explanation of why the experiment worked in town J and why it would not work in town T.
b. Does not provide solid data, only makes an assumption.
c. Out of scope.
d. Does not provide sufficient information about those six other towns to enable clear comparison of town T with those six towns.
e. Out of scope.
Similar topics Replies Last post
Similar
Topics:
6 Mayor of Plainsville: In order to help the economy 11 07 Apr 2015, 21:00
6 Mayor of Plainville: In order to help the economy of Plainsville 1 21 Nov 2014, 07:39
3 Mayor: The annual rock festival held in our town has gained 5 15 Sep 2013, 05:15
8 Mayor of Plainsville: In order to help the economy of 16 09 Dec 2012, 23:07
1 CR - Sales Tax 14 01 Mar 2009, 06:42
Display posts from previous: Sort by