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With Proposition 13, if you bought your house 11 years ago [#permalink]
15 Jan 2010, 22:34
Question Stats:
39% (02:34) correct
60% (02:03) wrong based on 4 sessions
With Proposition 13, if you bought your house 11 years ago for $75,000, your property tax would be approximately $914 a year (1 percent of $75,000 increased by 2 percent each year for 11 years); and if your neighbor bought an identical house next door to you for $200,000 this year, his tax would be $2,000 (1 percent of $200,000). Without Proposition 13, both you and your neighbor would pay $6,000 a year in property taxes (3 percent of $200,000). Which of the following is the conclusion for which the author most likely is arguing in the passage above? (A) Proposition 13 is unconstitutional because it imposes an unequal tax on properties of equal value. (B) If Proposition 13 is repealed, every homeowner is likely to experience a substantial increase in property taxes. (C) By preventing inflation from driving up property values, Proposition 13 has saved homeowners thousands of dollars in property taxes. (D) If Proposition 13 is not repealed, identical properties will continue to be taxed at different rates. (E) Proposition 13 has benefited some homeowners more than others.
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Re: With Proposition 13 [#permalink]
16 Jan 2010, 03:48
My answer is B
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Re: With Proposition 13 [#permalink]
16 Jan 2010, 11:25
IMO B.... Wats the OA?
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Re: With Proposition 13 [#permalink]
16 Jan 2010, 18:29
you are right. answer is B. will you explain? what's wrong with D
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Re: With Proposition 13 [#permalink]
17 Jan 2010, 02:53
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sanjayism wrote: you are right. answer is B. will you explain? what's wrong with D D says: "If Proposition 13 is not repealed, identical properties will continue to be taxed at different rates." In the given stem, we have no proof of this statement. We have the word identical property being bought at a different rate but there is another factor next to it. One preoperty was bought 11 years and another identical property was bought this year. Hence even the time the house was bought is a factor involved and hence we cannot assume the if Proposition 13 is not repealed, it would tax identical properties at different rates! And if you are considering the last statement as the bases for this answer, this won't be correct. As per last statement - "Without Proposition 13, both you and your neighbor would pay $6,000 a year in property taxes" it means If No Proposition 13 ....... then Same Tax But this doesn't mean that below statement is TRUE: If Proposition 13.... then DIFF TAX.... - This cannot be true! Imagine if you and your neighbour have the same property. Even with Proposition 13 rule, you would pay same Tax. Hence D is wrong... B says - "If Proposition 13 is repealed, every homeowner is likely to experience a substantial increase in property taxes." This is but obvious as the same is given in the stem. With Proposition, the tax would be $2,000. And if no Proposition then the tax would be $6,000... This would hold good for any property since with Proposition 13 it would be 1% of Property value of the first yr and without Proposition 13 it would be 3% of the property value
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Re: With Proposition 13 [#permalink]
30 Jun 2011, 16:41
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sanjayism wrote: With Proposition 13, if you bought your house 11 years ago for $75,000, your property tax would be approximately $914 a year (1 percent of $75,000 increased by 2 percent each year for 11 years); and if your neighbor bought an identical house next door to you for $200,000 this year, his tax would be $2,000 (1 percent of $200,000). Without Proposition 13, both you and your neighbor would pay $6,000 a year in property taxes (3 percent of $200,000).
Which of the following is the conclusion for which the author most likely is arguing in the passage above?
(A) Proposition 13 is unconstitutional because it imposes an unequal tax on properties of equal value. Author believes the opposite, in my view.
(B) If Proposition 13 is repealed, every homeowner is likely to experience a substantial increase in property taxes.
If the property depreciated substantially after the purchase, say from $75000 to $100, then the new homeowner will enjoy the benefit of the repeal and this statement would be false. But, we need to consider the intent of the author, who is using a real time scenario, in which the property price has actually appreciated a great deal and is likely to grow further. In this situation, paying 3% of the variable property price would definitely be more expensive than that from the scheme of proposition 13. Thus, I can safely assume that the author most likely wants to make this conclusion.
(C) By preventing inflation from driving up property values, Proposition 13 has saved homeowners thousands of dollars in property taxes.
What a check!! 75000 to 200000.
(D) If Proposition 13 is not repealed, identical properties will continue to be taxed at different rates.
This will be true only if the property is purchased at two different point in time. If two people buy identical properties at the same time, they will pay the same taxes. If the statement said "may" instead of "will", it would be more plausible.
(E) Proposition 13 has benefited some homeowners more than others.
In terms of the exact figure, may be. A house worth $100M would have saved more money, right. But, in terms of percentage, not likely. The case author presented seems to benefit everybody equally w.r.t the valuation of the property and the tax the owner is liable to pay.
Difficult question.
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Re: With Proposition 13 [#permalink]
01 Jul 2011, 10:04
hmm, I marked B as well, but i am still not sure why E is wrong.
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Re: With Proposition 13 [#permalink]
05 Jul 2011, 10:23
sanjayism wrote: With Proposition 13, if you bought your house 11 years ago for $75,000, your property tax would be approximately $914 a year (1 percent of $75,000 increased by 2 percent each year for 11 years); and if your neighbor bought an identical house next door to you for $200,000 this year, his tax would be $2,000 (1 percent of $200,000). Without Proposition 13, both you and your neighbor would pay $6,000 a year in property taxes (3 percent of $200,000).
Which of the following is the conclusion for which the author most likely is arguing in the passage above?
(A) Proposition 13 is unconstitutional because it imposes an unequal tax on properties of equal value. (B) If Proposition 13 is repealed, every homeowner is likely to experience a substantial increase in property taxes. (C) By preventing inflation from driving up property values, Proposition 13 has saved homeowners thousands of dollars in property taxes. (D) If Proposition 13 is not repealed, identical properties will continue to be taxed at different rates. (E) Proposition 13 has benefited some homeowners more than others. B For me as 6000 > 914 & 6000 > 2000 as well simply B states this only.......
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Re: With Proposition 13 [#permalink]
06 Jul 2011, 21:47
B for me.
Just a hunch -- I might be wrong -- but this question has a very UN-GMAT like feel to it --- LSAT question perhaps?
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Re: With Proposition 13 [#permalink]
08 Jul 2011, 02:00
B is the ans . Option D . (D) If Proposition 13 is not repealed, identical properties will continue to be taxed at different rates. Here it talks about identical properties. We have no information about the identical properties. So no conclusion / inference could be drawn.
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Re: With Proposition 13 [#permalink]
18 Jul 2011, 21:52
With Proposition 13. a 75,000 flat (11 years ago) --> $914 tax a 200,000 flat (now) --> $2000
Without Proposition 13, a 75,000 flat (11 years ago) --> $2000 tax a 200,000 flat (now) --> $2000 tax
(A) Proposition 13 is unconstitutional because it imposes an unequal tax on properties of equal value. (Out of scope) (B) If Proposition 13 is repealed, every homeowner is likely to experience a substantial increase in property taxes. (Answer) (C) By preventing inflation from driving up property values, Proposition 13 has saved homeowners thousands of dollars in property taxes. (Out of scope) (D) If Proposition 13 is not repealed, identical properties will continue to be taxed at different rates. (Out of scope) (E) Proposition 13 has benefited some homeowners more than others. (There is no basis for comparison of benefit)
I got it down as B. It seems the only conclusion we can make right?
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Re: With Proposition 13
[#permalink]
18 Jul 2011, 21:52
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