Canadians now increasingly engage in : GMAT Critical Reasoning (CR)
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# Canadians now increasingly engage in

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Intern
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09 Aug 2003, 04:06
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Canadians now increasingly engage in тАЬout-shopping,тАЭ which is shopping across the national border, where prices are lower. Prices are lower outside of Canada in large part because the goods-and-services tax that pays for Canadian social services is not applied.

Which one of the following is best supported on the basis of the information above?
(A) If the upward trend in out-shopping continues at
a significant level and the amounts paid by the
government for Canadian social services are
tax will be assessed at a higher rate.
(B) If Canada imposes a substantial tariff on the
goods bought across the border, a reciprocal
tariff on cross-border shopping in the other
direction will be imposed, thereby harming
(C) The amounts the Canadian government pays out
to those who provide social services to
(D) The same brands of goods are available to
Canadian shoppers across the border as are
(E) Out-shopping purchases are subject to Canadian
taxes when the purchaser crosses the border to
If you have any questions
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09 Aug 2003, 05:52
Any other answers... or should I post the correct one
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09 Aug 2003, 18:10
A is fine...correct..just wanted some more answers..if any!
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09 Aug 2003, 18:10
A is fine...correct..just wanted some more answers..if any!
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20 May 2005, 07:50
Why not D? With A, there is assumption that Candian govt will react. Howevr, D is based on the fact that same goods are available in and out Canada.
s
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20 May 2005, 08:52
A for me too.

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20 May 2005, 08:58
I will go with D
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20 May 2005, 12:47
Can somebody plz explain the choices and refute the wrong ones?
S
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23 May 2005, 07:30
saurya_s wrote:
Can somebody plz explain the choices and refute the wrong ones?
S

(A) If the upward trend in out-shopping continues at
a significant level and the amounts paid by the
government for Canadian social services are
tax will be assessed at a higher rate. => the government has to react so that the revenues from taxes are maintained. one step would be to raise taxes. so thats a valid inference. => right
(B) If Canada imposes a substantial tariff on the
goods bought across the border, a reciprocal
tariff on cross-border shopping in the other
direction will be imposed, thereby harming
Canadian businesses. => this is just too much inference. the difference to A) is that the government already imposes taxes and so its fine to conclude that the purpose of the taxes is reinforced by raising taxes. => wrong
(C) The amounts the Canadian government pays out
to those who provide social services to
Canadians are increasing. => no. we dont know if the government will pay out greater amounts. the difference to A) is that A) defines more parameters such as "If the upward trend in out-shopping continues at
a significant level" and "the amounts paid by the government for Canadian social services are maintained" so that the inference is more plausible. => wrong
(D) The same brands of goods are available to
Canadian shoppers across the border as are
available in Canada. => we can infer that SOME are equal but we cannot infer that ALL are equal. too much inference again. => wrong
(E) Out-shopping purchases are subject to Canadian
taxes when the purchaser crosses the border to
bring them into Canada. => we dont know that. => wrong
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23 May 2005, 10:01
saurya_s wrote:
Why not D? With A, there is assumption that Candian govt will react. Howevr, D is based on the fact that same goods are available in and out Canada.
s

if prices are low and attractive, Canadians still will go shopping at the boarder eventhough the brands are different, so D is not true.

A it is.
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23 May 2005, 13:50
D for me. The goods need to be of the same quality/brand, in order to say that consumers are driven by price differences.

A is wrong imo because, the argument doesn;t say if it is good or bad, and there is no hint at canadian government doing something about it. For all that matters, Canadian government can impose additional taxes on Canadian businesses in Canada in order to compensate for the lack of GST receipts.
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23 May 2005, 21:03
A should be the correct answer.

Price driven doesn't necessarily mean goods are same. Goods might be better and still cheaper. so, D cannot be concluded
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24 May 2005, 05:19
A
24 May 2005, 05:19
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