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A state government is considering a policy that would require new apar

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A state government is considering a policy that would require new apar  [#permalink]

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New post 19 Jul 2018, 21:21
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A state government is considering a policy that would require new apartment complexes to feature solar panels to help offset the amount of energy consumed by individual units. The policy would not affect existing apartment buildings, and the cost of the solar panels would be offset by a tax credit that would apply for as long as the original builder owns the apartment complex. Because this tax credit would offset the cost of the solar panels within five years, it is surprising that the apartment building company Aptly Built is protesting the policy.

Which of the following, if true, would best explain Aptly Built’s opposition to the proposed policy?


A. Installing solar panels and other clean energy producing units does not increase the resale value of the apartment complexes.

B. The new policy does not specify whether solar panels must be approved by the government, which could lead to fraud.

C. Aptly Built must currently comply with similar laws in other states that do not include a tax credit.

D. Aptly Built’s current business model involves building apartments and then selling them to management companies immediately after the complexes are completed.

E. The majority of Aptly Built’s ventures involve building apartments in areas of the state where solar panels would generate less energy.

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Re: A state government is considering a policy that would require new apar  [#permalink]

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New post 19 Jul 2018, 22:17
Bunuel wrote:
A state government is considering a policy that would require new apartment complexes to feature solar panels to help offset the amount of energy consumed by individual units. The policy would not affect existing apartment buildings, and the cost of the solar panels would be offset by a tax credit that would apply for as long as the original builder owns the apartment complex. Because this tax credit would offset the cost of the solar panels within five years, it is surprising that the apartment building company Aptly Built is protesting the policy.

Which of the following, if true, would best explain Aptly Built’s opposition to the proposed policy?


A. Installing solar panels and other clean energy producing units does not increase the resale value of the apartment complexes.

B. The new policy does not specify whether solar panels must be approved by the government, which could lead to fraud.

C. Aptly Built must currently comply with similar laws in other states that do not include a tax credit.

D. Aptly Built’s current business model involves building apartments and then selling them to management companies immediately after the complexes are completed.

E. The majority of Aptly Built’s ventures involve building apartments in areas of the state where solar panels would generate less energy.


Q->Aptly Built’s opposition to the proposed policy
Given:1.The policy would not affect existing apartment building
2. tax credit would offset the cost of the solar panels within five years.
3.the cost of the solar panels would be offset by a tax credit that would apply for as long as the original builder owns the apartment complex

Prethinking: What if Aptly Built dosent want to keep houses for more years. So the tax credit will not offset the cost.

Option D is aligned.

Kindly correct me if I am wrong
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Re: A state government is considering a policy that would require new apar  [#permalink]

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New post 20 Jul 2018, 03:42
A state government is considering a policy that would require new apartment complexes to feature solar panels to help offset the amount of energy consumed by individual units. The policy would not affect existing apartment buildings, and the cost of the solar panels would be offset by a tax credit that would apply for as long as the original builder owns the apartment complex. Because this tax credit would offset the cost of the solar panels within five years, it is surprising that the apartment building company Aptly Built is protesting the policy.

Which of the following, if true, would best explain Aptly Built’s opposition to the proposed policy?
Boil it down - Because this tax credit would offset the cost of the solar panels within five years, it is surprising that the apartment building company Aptly Built is protesting the policy.
Pre-thinking - what if the apartment is sold by original builder within five years?

A. Installing solar panels and other clean energy producing units does not increase the resale value of the apartment complexes. - Incorrect

B. The new policy does not specify whether solar panels must be approved by the government, which could lead to fraud. - Incorrect

C. Aptly Built must currently comply with similar laws in other states that do not include a tax credit. - Irrelevant

D. Aptly Built’s current business model involves building apartments and then selling them to management companies immediately after the complexes are completed. - Correct - So the tax credit won't be utilised once the original builder sells the building

E. The majority of Aptly Built’s ventures involve building apartments in areas of the state where solar panels would generate less energy. - Irrelevant

Answer D
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Re: A state government is considering a policy that would require new apar  [#permalink]

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New post 22 Jul 2018, 09:15
Bunuel wrote:
A state government is considering a policy that would require new apartment complexes to feature solar panels to help offset the amount of energy consumed by individual units. The policy would not affect existing apartment buildings, and the cost of the solar panels would be offset by a tax credit that would apply for as long as the original builder owns the apartment complex. Because this tax credit would offset the cost of the solar panels within five years, it is surprising that the apartment building company Aptly Built is protesting the policy.

Which of the following, if true, would best explain Aptly Built’s opposition to the proposed policy?


A. Installing solar panels and other clean energy producing units does not increase the resale value of the apartment complexes.

B. The new policy does not specify whether solar panels must be approved by the government, which could lead to fraud.

C. Aptly Built must currently comply with similar laws in other states that do not include a tax credit.

D. Aptly Built’s current business model involves building apartments and then selling them to management companies immediately after the complexes are completed.

E. The majority of Aptly Built’s ventures involve building apartments in areas of the state where solar panels would generate less energy.


VERITAS PREP OFFICIAL SOLUTION:



In an “Explain the Paradox” question, remember that you must find an answer choice that bridges the gap between the two facts (as opposed to a premise and a conclusion). Your first job, then, is to reflect on that gap that seemingly makes the two statements incompatible.

Here, the stimulus states that the government may pass a policy that requires new apartment complexes to be built with solar panels. However, it also states that (as long as the original builder owns the building) that the builder will get a tax credit that will pay for the solar panels within 5 years. Apartment complex builder Aptly Built surprisingly opposes this legislation. For them to do so, there must be some sort of gap between the tax credit policy, which would benefit them, and something that they do in their building process that might mean that they don't actually benefit from the tax credit.

The only answer that would mean that they wouldn't benefit from the tax credit is (D), that the company builds apartments and then immediately sells them. Since the tax credit only applies as long as the original builder still owns the building, selling the building immediately would mean that Aptly Built would get no tax benefits and would not gain back the cost of the solar panels.

Among the other answers, choice (A) can be eliminated since it doesn't mean that Aptly Built won't benefit if they have the apartment building long enough for the tax credit to pay for the solar panels. Choice (B) can also be eliminated, since Aptly Built won't be affected by fraud, only whether they have to install the panels and whether they get their money back through the tax credit. Choice (C) would imply that Aptly Built should be more in favor of the law since in this state they could make some money back through the tax credit. And choice (E) can be eliminated since the amount of energy the solar panels produce doesn't affect whether or not they get their tax credit.

An important lesson here: when a question includes "extra" information, it's important to notice it. For example here the policy could be "the cost will be offset by a tax credit," but the argument takes care to note "that will apply for as long as the original owner owns the building." It could just mention "this tax credit would offset the cost of the panels" but also adds "within five years." If you notice these "extras" - original owner, within five years - you should be able to anticipate the right answer or something very close to it.
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Re: A state government is considering a policy that would require new apar   [#permalink] 22 Jul 2018, 09:15
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