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# Fact1: Over the past eight years , cuts in federal income

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Senior Manager
Joined: 07 Nov 2009
Posts: 303

Kudos [?]: 699 [0], given: 20

Fact1: Over the past eight years , cuts in federal income [#permalink]

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19 Aug 2010, 23:03
00:00

Difficulty:

25% (medium)

Question Stats:

94% (01:14) correct 6% (00:00) wrong based on 16 sessions

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Fact1: Over the past eight years , cuts in federal income tax
rates have resulted in US taxpayers paying a smaller proportion of
their incomes as federal taxes.

Fact2: OVer the past eight years , US taxpayers have paid a larger
proportion of their incomes as state and local taxes.

Fact1 would most likely contribute to an explanation of Fact2 if
which of the following were true?

a. An increased demand in the number and quality of services provided
by state an local authorities has occured in the last eight years.
b. Lower federal income taxes have increased the amount of money in
the economy available for discretionary spending.
c. Over the past years, a large number of states have instituted
state income taxes, in addition to the more common property and sales
taxes.
d. Cuts in the federal income tax were made possible by ending or
downsizing many federal programs.
e. Cuts in the federal income tax were made possible by shifting the
costs of some programs to state and local authorities.

Why not C?
[Reveal] Spoiler: OA

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Manager
Joined: 11 May 2010
Posts: 216

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Re: past eight years [#permalink]

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20 Aug 2010, 00:33
E it is.

C is incorrect because C doesn't explain why Fact 1 could contribute to Fact 2. C only may be explain why taxpayers have to play a portion of their income for State tax, but it doesn't link Fact 1 with Fact 2.

E perfectly link the 2 facts together

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Intern
Joined: 31 Jul 2010
Posts: 17

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Re: past eight years [#permalink]

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21 Aug 2010, 10:23
E it is

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Senior Manager
Joined: 12 Oct 2009
Posts: 256

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Schools: Columbia, INSEAD, RSM, LBS
Re: past eight years [#permalink]

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21 Aug 2010, 11:29
E is a clear winner here

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Manager
Joined: 15 Apr 2010
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Re: past eight years [#permalink]

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21 Aug 2010, 11:42
E is the option that connects Fact 1 and Fact 2...

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VP
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Re: past eight years [#permalink]

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23 Aug 2010, 08:28
Only E explains the cut in federal income taxes and increase in state and local taxes

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Manager
Joined: 28 Feb 2010
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WE 1: 3 (Mining Operations)
Re: past eight years [#permalink]

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24 Aug 2010, 01:23
rohitgoel15 wrote:

Why not C?

The important catch here is Fact 1 need to explain Fact 2.
Option C is only explaining Fact 2. That too, it brings a new information. Moreover, you can notice the subtle scope shift from "US taxpayer" to "Large No of States have instituted"..Right !!

E explicates the link between F1 and F2.
_________________

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Invincible...
"The way to succeed is to double your error rate."
"Most people who succeed in the face of seemingly impossible conditions are people who simply don't know how to quit."

Kudos [?]: 39 [0], given: 33

Re: past eight years   [#permalink] 24 Aug 2010, 01:23
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# Fact1: Over the past eight years , cuts in federal income

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