Public hospitals are suffering because of a lack of money

We're told that local governments plan to help fund hospital expansion projects by offering municipal bonds with above-average interest rates, which encourage people to buy these bonds.

The author concludes that if more bonds are purchased, more money will in turn be available for hospital's physical expansion projects.

We're asked to weaken this argument. The local governments' plan supposes that the money invested in municipal bonds will be readily available to hospitals in the form of funds for physical expansion projects. Therefore, to undermine this argument, we need to identify a reason why money might not go to hospital expansion projects.

Choice A states that when local governments offer high-interest municipal bonds, the money given to other projects increases. If this were true, this undermines the assumption that more money will go to hospital expansion projects. Choice A is correct.

Choice B states that the increased money from municipal bonds would not offset the loss in revenue from personal income taxes during the first year of the plan. The goal of the plan is to increase the amount of money available as physical expansion funds for hospitals, so this point is irrelevant to the effectiveness of the plan.

Choice C states that even with interest rate incentives, some people will not purchase municipal bonds. The effectiveness of the plan would be determined not by what some people do, but by what most people do.

Choice D states that people will generally not buy municipal bonds which, when, repaid, do not yield enough money to help them pay significant personal expenses. The plan would increase the money available specifically for hospitals' physical expansion projects, not individuals' personal loans.

Choice E states that municipal bonds would give all buyers, regardless of how many bonds they buy, the same interest rate per bond. The universal interest rate does not affect the effectiveness of the plan.