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To reduce its budget deficit

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To reduce its budget deficit [#permalink] New post 30 Sep 2013, 06:25
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A
B
C
D
E

Difficulty:

  5% (low)

Question Stats:

79% (02:13) correct 21% (01:05) wrong based on 95 sessions
To reduce its budget deficit, a municipal government is considering a plan to delay expenditures on a major reconstruction of the city's bridges and highways.

Each of the following, assuming that it is a realistic possibility, is a possible disadvantage to the city of the plan EXCEPT:

a) If left untended, some of the bridges will degenerate to a point where they can no longer be repaired.
b) A delay in the bridge and highway overhaul might allow repair workers to make use of new technologies that will be available in the future.
c) The cost of continuous maintenance of the badly corroding highways and bridges will exceed the costs of reconstruction.
d) Much of the cost of the reconstruction project was to be paid for with federal money that cannot be used for any other purpose.
e) The city has already purchased the raw materials and machinery needed for the reconstruction —— which constituted the bulk of the cost of the project.


Please help me answer the above question. I am confused between B and D.
My reasons:
Option B: Though it supports the delay in work, the explanation that workers amy be able to use new technologies has no link with the financial factor that is cited in the argument.

Option D: This option supports the financial deficit. If the federal budget for this project is not utilised then the deficit will not be soo bad!

Please help choose between the two.

Thanks.
[Reveal] Spoiler: OA
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Re: To reduce its budget deficit [#permalink] New post 30 Sep 2013, 06:53
Hi Vaibhav,

Option B is not at all related to the budget deficit, instead it takes you to think about a very different perspective about availing latest technology in future. Hence it is the right answer.

Option D is not correct. To explain this, consider a scenario where Central government gives certain amount of financial aid to a agency to repair roads of a city, therefore that agency is bound to use that money only for repairing purpose and it would be illegal if that agency uses that money for any other public welfare related project (like building children park, water pipeline repairing etc.) or improving its financial position.
So in this case also the municipal corporation can only use the allotted federal money for repairing roads because if they don't use it then the funds will lie idle in federal coffers or if they use it to reduce their budget deficit then it will be considered illegal.

I hope it is clear now :-D :-D
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Re: To reduce its budget deficit [#permalink] New post 02 Oct 2013, 07:54
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kalravaibhav wrote:
To reduce its budget deficit, a municipal government is considering a plan to delay expenditures on a major reconstruction of the city's bridges and highways.

Each of the following, assuming that it is a realistic possibility, is a possible disadvantage to the city of the plan EXCEPT:

a) If left untended, some of the bridges will degenerate to a point where they can no longer be repaired.
b) A delay in the bridge and highway overhaul might allow repair workers to make use of new technologies that will be available in the future.
c) The cost of continuous maintenance of the badly corroding highways and bridges will exceed the costs of reconstruction.
d) Much of the cost of the reconstruction project was to be paid for with federal money that cannot be used for any other purpose.
e) The city has already purchased the raw materials and machinery needed for the reconstruction —— which constituted the bulk of the cost of the project.


Please help me answer the above question. I am confused between B and D.
My reasons:
Option B: Though it supports the delay in work, the explanation that workers amy be able to use new technologies has no link with the financial factor that is cited in the argument.

Option D: This option supports the financial deficit. If the federal budget for this project is not utilised then the deficit will not be soo bad!

Please help choose between the two.

Thanks.




What about OPTION "C"...According to this possibility also, delaying the expenditure will be beneficial to the city..because continual repair costs more....
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Re: To reduce its budget deficit [#permalink] New post 03 Oct 2013, 00:53
Himang,

According to the question, Muncipal govt. has decided to delay the expenditures on bridges and roads re-construction, so if they are not rebuilding anything then they will have to carry out regular maintenance on the old roads and bridges. The maintenance work will be very costly and the amount will exceed the cost of reconstruction & will ultimately increase the account deficit in future, hence it is not wise to delay the reconstruction project.
Re: To reduce its budget deficit   [#permalink] 03 Oct 2013, 00:53
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