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# Current farm policy is institutionalized penalization of

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GMAT Club Legend
Joined: 07 Jul 2004
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Current farm policy is institutionalized penalization of [#permalink]

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02 Sep 2005, 08:26
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Current farm policy is institutionalized penalization of consumers. It increases food prices for middle- and low-income families and costs the taxpayer billions of dollars a year.
Which of the following statements, if true, would provide support for the authorâ€™s claims above?

I. Farm subsidies amount to roughly \$20 billion a year in federal payouts and \$12 billion more in higher food prices.
II. According to a study by the Department of Agriculture, each \$1 of benefits provided to farmers for ethanol production costs consumers and taxpayers \$4.
III.The average full-time farmers have an average net worth of over \$300,000.

(A) I only
(B) II only
(C) III only
(D) I and II only
(E) I, II, and III

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Senior Manager
Joined: 13 Jan 2005
Posts: 329

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02 Sep 2005, 08:40
IMO B. I am so tempted to choose D. But to include (I) would involve a lot of assumptions - Federal earnings primarily come from taxes paid by consumers, and that the higher prices of \$12B primarily effects the low and middle income consumers.

GA

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Senior Manager
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02 Sep 2005, 13:26
I. Farm subsidies amount to roughly \$20 billion a year in federal payouts and \$12 billion more in higher food prices

I do not understand the sentence...can somebody explain...
_________________

Fear Mediocrity, Respect Ignorance

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Manager
Joined: 07 Jun 2005
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02 Sep 2005, 15:59
I echo ranga's sentiments..."more" than what??

I guess III is out so betwen I and II. II will certainly give support( as cost to consumers has gone up), so between B and D.

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GMAT Club Legend
Joined: 07 Jul 2004
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03 Sep 2005, 01:46
OA is D.

I. Farm subsidies amount to roughly \$20 billion a year in federal payouts and \$12 billion more in higher food prices.
- All these payouts will come from taxpayers and the discounts off higher food prizes increases what middle and low income families have to pay

II. According to a study by the Department of Agriculture, each \$1 of benefits provided to farmers for ethanol production costs consumers and taxpayers \$4.
- payouts from taxpayers

III.The average full-time farmers have an average net worth of over \$300,000.
- not important

So I and II are relevant.

Kudos [?]: 452 [0], given: 0

03 Sep 2005, 01:46
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# Current farm policy is institutionalized penalization of

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