PriyamRathor wrote:
Hello Experts,
RonTargetTestPrepMartyTargetTestPrepGMATNinjaKarishmaBChiranjeevSinghFollowing are the two Inference CR question, both have similar reasoning but use different LOGIC.
I am really confused to as what should be the approach to CR Inference Questions.
Question- 1https://gmatclub.com/forum/proponents-o ... 41472.htmlQuote:
Proponents of the recently introduced tax on sales of new luxury boats had argued that a tax of this sort would be an equitable way to increase government revenue because the admittedly heavy tax burden would fall only on wealthy people and neither they nor anyone else would suffer any economic hardship. In fact, however, 20 percent of the workers employed by manufacturers of luxury boats have lost their jobs as a direct result of this tax.
The information given, if true, most strongly supports which of the following?
(A) The market for luxury boats would have collapsed even if the new tax on luxury boats had been lower.
(B) The new tax would produce a net gain in tax revenue for the government only if the yearly total revenue that it generates exceeds the total of any yearly tax-revenue decrease resulting from the workers' loss of jobs.
(C) Because many people never buy luxury items, imposing a sales tax on luxury items is the kind of legislative action that does not cost incumbent legislators much popular support.
(D) Before the tax was instituted, luxury boats were largely bought by people who were not wealthy.
(E) Taxes can be equitable only if their burden is evenly distributed over the entire population.
Fact1: Tax on sales of New luxury boats has been introduced. This heavy tax burden would fall only on wealthy people and neither they nor anyone else would suffer any economic hardship.
Fact2 : 20 % of workers employed by manufactures of luxury boat lost their jobs.
Answer is Choice B
Why can't Choice D be the answer ? Because we are not concerned with what caused the workers lose their jobs.
Pasting
GMATNinja reasoning:-
Quote:
Why did they lose their jobs? Perhaps some people who could have afforded a luxury boat without the tax could not afford a luxury boat with the tax, causing sales and, thus, production of luxury boats to decline. Regardless of whether this theory is true, we cannot assume that the people who decided not to buy luxury boats because of the tax were not wealthy. Even if we could, we would not be able to assume that luxury boats were LARGELY bought by people who were not wealthy before the tax was instituted. There is nothing in the passage to support choice (D), so it must be eliminated.
TOTALLY AGREE WITH WHAT Charles is saying.
In Inference Questions we are not supposed to be CRITICAL. Rather we are supposed to see which answer choice can be INFERRED with respect to the STIMULUS.Question- 2https://gmatclub.com/forum/to-protect-c ... 12491.htmlQuote:
To protect certain fledgling industries, the government of country Z banned imports of the types of products those industries were starting to make. As a direct result, the cost of those products to the buyers, several export-dependent industries in Z, went up, sharply limiting the ability of those industries to compete effectively in their export markets.
Which of the following conclusions about country Z's adversely affected export-dependent industries is best supported by the passage?
(A) Profit margins in those industries were not high enough to absorb the rise in costs mentioned above.
(B) Those industries had to contend with the fact that other countries banned imports from country Z.
(C) Those industries succeeded in expanding the domestic market for their products.
(D) Steps to offset rising materials costs by decreasing labor costs were taken in those industries.
(E) Those industries started to move into export markets that they had previously judged unprofitable.
Fact1: Govt of Country Z banned import of products manufactured by fledging industries
Fact2: Cost of these products to the buyers(EDI) increased and hence it limited their ability to compete effectively in their export markets.
Answer is Choice A
Now here we are choosing an answer which answers the question of "Why did they could not compete in export markets?"I am really confused because how can we infer that since profits margins in those industries were not high to absorb the increased cost , hence they could not compete in foreign market? It could be that , these industries were not ready to lower to the prices , hence they could not compete.
It could be that , these industries lowered the quality of products , hence they could not compete in the international market.
TO SUMMARIZE MY QUESTION:-In question 1 - we say that we are not concerned with why workers lost their JOB
whereas
In question 2 - we are answering why EDI failed to compete in export markets?
On one hand we say that INFERENCE questions doesn't require us to be CRITICAL , on the other hand it is our CRITICAL THINKING which will help us INFER answer in question 2.Please Guide.
We are talking about 'critical reasoning' questions so critical thinking is a must - at ALL times.
In
question 1, the reason option (D) is not the answer is that it is not supported by the given information.
All the passage tells us is that because of the tax, 20% employees have lost their jobs. The reason the employees lost their jobs could be many
- perhaps to offset the tax burden, the boat manufacturers decided to reduce their boat prices and hence decided to reduce their costs and make do with fewer employees
or
- perhaps the boats became expensive so fewer people bought them leading to losses to boat manufacturers and hence the lay offs
etc.
All we know from the argument is that tax led to lay offs. Mind you, there are many reasons for 'tax leading to lay offs' and the argument doesn't tell us which one took place.
(D) Before the tax was instituted, luxury boats were largely bought by people who were not wealthy.
Is (D) supported by the argument is any way? No.
Perhaps wealthy people bought boats before tax. But now, the boats are too expensive (not worth the money) for even the wealthy people.
Or perhaps the same people as before are buying the same number of boats because the manufacturer has set off the tax increase by laying off people etc.
We don't know. (D) is not supported and is not the answer.
In
question 2, we are given that the cost of the companies went up and this limited their ABILITY to compete.
They were not able to compete (nothing about intention - the ability went away). This means they did not have enough profit margin (only then will it limit their ability). We don't have to infer one situation out of many possible. There is only one possible situation. If they had enough profit margin in the first place, their ability to compete would have been maintained. Whether they would have been willing to compete to not is a different matter.
That is why option (A) makes sense here.
close
25 Aug 2022, 11:40
