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Which of the following most logically completes the passage?

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Which of the following most logically completes the passage? [#permalink] New post 01 Feb 2005, 06:09
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A
B
C
D
E

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Which of the following most logically completes the passage?

Concerned about financial well-being of its elderly citizens, the government of Runagia decided two years ago to increase by 20 percent the government-provided pension paid to all Runagians over 65. Inflation in the intervening period has been negligible, and the increase has been duly received by all eligible Runagians.
Nevertheless, many of them are no better off financially than they were before the increase, in large part because ________.

A).They rely entirely on the government pension for their income

B).Runagian banks are so inefficient that it can take up to three weeks to cash a pension check

C).They buy goods whose prices tend to rise especially fast in times of inflation

D).The pension was increased when the number of elderly Runagians below the poverty level reached an all-time high

E).In Runagia children typically supplement the income of elderly parents, but only by enough to provide them with a comfortable living

please MUST explain it. thanks

Last edited by chunjuwu on 01 Feb 2005, 08:55, edited 1 time in total.
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 [#permalink] New post 01 Feb 2005, 06:30
C. this is the only one which talks about increase of price in the goods and even if income is increased if the goods are expensive.. then obviously the elderly people will not be financially well off.
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 [#permalink] New post 01 Feb 2005, 06:48
I will go with ‘E’

‘A’ – If they had relied entirely on the government pension they would have been better off financially, so this can be eliminated.
‘B’ – Out of Context
‘C’ – The argument says that inflation is negligible – so this can be eliminated and moreover I think this is out of context too
‘D’ – This cannot be the reason why they are not well off after the increase, so this can be eliminated.

‘E’ – Let us assume that it takes about $1000.00 to lead a comfortable life and the government’s program was paying the elders about $500.00/month, so according to ‘E’ the children would have given their parents $500.00/month to manage their expenses. Now after the increase let us assume the government is paying the elders $800.00 the children will be paying their parents $200.00 and not $500.00 to cover for their expenses, so the elders will not be better off than they were before the increase in payouts by the government.
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 [#permalink] New post 01 Feb 2005, 06:57
I have seen this question somewhere and the answer is (C) as vprabhala's explaination.
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 [#permalink] New post 01 Feb 2005, 07:02
chunjuwu, do you have the OA & an OE to go with that
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Re: CR0212--pention [#permalink] New post 01 Feb 2005, 08:06
It can't be (C).

A).They rely entirely on the government pension for their income
So their status should be improved.

B).Runagian banks are so inefficient that it can take up to three weeks to cash a pension check
Still their status should be improved after the first three weeks.

C).They buy goods whose prices tend to rise especially fast in times of inflation
It says it "Inflation in the intervening period has been negligible", so it is NOT in time of inflation.

D).The pension was increased when the number of elderly Runagians below the poverty level reached an all-time high
If we read the question as the gov increase 20% for the total pension fund, then this would be the answer. However after a close read it seemed that everyone did receive an increase ("the increase has been duly received by all eligible Runagians").

E).In Runagia children typically supplement the income of elderly parents, but only by enough to provide them with a comfortable living
This is the right answer. As when the elderlys receive more from the gov, they receive less from their children, so their overal status are unchanged.
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 [#permalink] New post 01 Feb 2005, 08:10
I thought c too.

however, the inflation part in it makes it a bit confusing.This is because the stem says negligible inflatation and part c talks bout prices of goods rising during inflation.anyone got a better explanation?
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 [#permalink] New post 01 Feb 2005, 08:14
got it HongHu.

good expln :wink:
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 [#permalink] New post 01 Feb 2005, 08:33
C !

@HongHu: it is in times of inflation, but the inflation is negligble or marginal; but the prices still rise
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 [#permalink] New post 01 Feb 2005, 08:51
christoph wrote:
C !

@HongHu: it is in times of inflation, but the inflation is negligble or marginal; but the prices still rise


Inflation rate is neglegible means it is NOT a time of inflation.
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 [#permalink] New post 01 Feb 2005, 08:53
Thanks rthothad and others.

OA indeed is E.
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 [#permalink] New post 01 Feb 2005, 08:58
i want to know the source of the question.. i cannot believe its E...
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 [#permalink] New post 01 Feb 2005, 15:52
Despite that i have seen this question before i do not understand why the answer is (E)
  [#permalink] 01 Feb 2005, 15:52
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