Bunuel wrote:
Economies in which a high percentage of resources are invested in research and development show greater growth in the long run than do those in which resources are channeled into consumption. Japanese workers spend a higher percentage of their income investing in research and development than do American workers.
To grow as fast as Japan has in the past three decades, the United States must change the tax code in order to encourage savings and investment and discourage debt.
Which of the following, if true, tends to weaken the argument?
(A) Japanese research is more focused on consumers than is research by American firms.
(B) Class mobility, highly valued in American culture, is encouraged by a growing rather than a stagnant economy.
(C) Studies have shown that countries with high consumption rates prosper in the short run.
(D) Proposed changes to the tax code could involve strict limits on the deductability of interest, and increased allowance for research.
(E) Because a decreasing percentage of the United States is under 40, an age when savings are traditionally low, the savings rate will increase without changes to the tax code.
↑ % Investment in R &D = ↗↗ Growth in Long Term
Jp ↑ % > US ↑ % ( Investment )
Conc : US = Change Tax code to encourage savings and investment and discourage debt.
Prethink : How to weaken -
Even if US govt encourages savings by Tax cuts citizens keep on high consumption - thereby reducing savings & thereby Investment (for which they have to rely on external debts )
NOw Examine the options -
(A) Jp more focused on consumers than is research - Out of scope
(B) Class mobility, highly valued in American cultur - Out of scope
(C) Talks about " High consumption rates prosper in the short run " Irrelevant and completely out of scope and context of discussion as the highlighted part talks about long term
(D) strict limits on the deductability of interest, and increased allowance for research - Not exactly, we need to disprove that change in tax code will ahve any desirable effect.
(E) States that a greater % of people are over 40 as such the savings rate will increase without changes to the tax code., this clearly weakens the proposal/plan of the US Government.
Hencce IMHO (E)