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Five years ago, as part of a plan to encourage citizens of

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Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 14 May 2008, 11:46
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Five years ago, as part of a plan to encourage citizens of Levaska to increase the amount of money they put into savings, Levaska’s government introduced special savings accounts in which up to $3,000 a year can be saved with no tax due on the interest unless money is withdrawn before the account holder reaches the age of sixty-five. Millions of dollars have accumulated in the special accounts, so the government’s plan is obviously working.
Which of the following, if true, most seriously weakens the argument?

A. A substantial number of Levaskans have withdrawn at least some of the money they had invested in the special accounts.
B. Workers in Levaska who already save money in long-term tax-free accounts that are offered through their workplace cannot take advantage of the special savings accounts introduced by the government.
C. The rate at which interest earned on money deposited in regular savings accounts is taxed depends on the income bracket of the account holder.
D. Many Levaskans who already had long-term savings have steadily been transferring those savings into the special accounts.
E. Many of the economists who now claim that the government’s plan has been successful criticized it when it was introduced.
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 03 Dec 2014, 00:15
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mymba99 wrote:
Five years ago, as part of a plan to encourage citizens of Levaska to increase the amount of money they put into savings, Levaska’s government introduced special savings accounts in which up to $3,000 a year can be saved with no tax due on the interest unless money is withdrawn before the account holder reaches the age of sixty-five. Millions of dollars have accumulated in the special accounts, so the government’s plan is obviously working.
Which of the following, if true, most seriously weakens the argument?

A. A substantial number of Levaskans have withdrawn at least some of the money they had invested in the special accounts.
B. Workers in Levaska who already save money in long-term tax-free accounts that are offered through their workplace cannot take advantage of the special savings accounts introduced by the government.
C. The rate at which interest earned on money deposited in regular savings accounts is taxed depends on the income bracket of the account holder.
D. Many Levaskans who already had long-term savings have steadily been transferring those savings into the special accounts.
E. Many of the economists who now claim that the government’s plan has been successful criticized it when it was introduced.


To solve the question, we need to understand the situation first. If we read the argument, we can decipher that situation is
A new Kind of savings account is introduced--> To increase savings.
Fact--Millions of $ are flowing in -->Conclusion-- Govt.'s plan is working
Pre-thinking possible Assumptions-- People are depositing money in new accounts, money is not flowing in those accounts from anywhere else.

Solution will be any statement that can weaken the above assumtions or the conclusion i.e if we can find that people are not depositing money or money is flowing in the savings account from other sources or something on these lines.

Note: You need not pin point exact assumptions and find exact answers. But this excercise will help you get near the answer.

Option A-- It states that some of the money is withdrawn from savings account. It might seem that it is weakening the conclusion that Govt's plan to increase savings is working..but in actual it is not. Even if some people have woithdrawn money from those accounts..it can quite be possible that a lot more is submitted...hence, in nutshell there is an increase. Also, the statement Millions of $ are flowing in is mentioned as a fact, unless we know for sure that withdrawn amount is equal or more than deposited, we can't weaken the net conclusion.


Option B-- The plan was for citizens, but it talks about workers. We don't know what part of population are workers. So the effect on the savings and hence conclusion can't eb fully determined.

Option C-- Irrelevant. In absence of any demographic data, we can't determine the effect of tax rates on savings

Option D-- This is the one we're trying to find here. IF the money in the tax saving accounts is coming from other savings accounts, then net savings are not increasing. This weakens the assumption that people are depositing fresh money in tax saving accounts.
Consider this-- Let's say-- Money in prev Saving accounts--100, In new from prev--40 Remaining in prev saving accounts-60.. So net savings-- still 100.. so Govt's plan is not working.
Hence this is the solution

Option E--This option if anything is strengthening the argument. If critics are praising the plan, that means somehow it must be working. We have to find a weakener.


Hope this helps
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 14 May 2008, 11:53
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I would say B. Because most of the people who save are workers, and most workers are not eligible for this special account if they already have an account at work.
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 14 May 2008, 14:25
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saravalli wrote:
Five years ago, as part of a plan to encourage citizens of Levaska to increase the amount of money they put into savings, Levaska’s government introduced special savings accounts in which up to $3,000 a year can be saved with no tax due on the interest unless money is withdrawn before the account holder reaches the age of sixty-five. Millions of dollars have accumulated in the special accounts, so the government’s plan is obviously working.
Which of the following, if true, most seriously weakens the argument?

A. A substantial number of Levaskans have withdrawn at least some of the money they had invested in the special accounts.
B. Workers in Levaska who already save money in long-term tax-free accounts that are offered through their workplace cannot take advantage of the special savings accounts introduced by the government.
C. The rate at which interest earned on money deposited in regular savings accounts is taxed depends on the income bracket of the account holder.
D. Many Levaskans who already had long-term savings have steadily been transferring those savings into the special accounts.
E. Many of the economists who now claim that the government’s plan has been successful criticized it when it was introduced.


D for me.
The amount of money saved is the same if D is true, so plan is not really working. No money has been saved.
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 14 May 2008, 19:55
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saravalli wrote:
Five years ago, as part of a plan to encourage citizens of Levaska to increase the amount of money they put into savings, Levaska’s government introduced special savings accounts in which up to $3,000 a year can be saved with no tax due on the interest unless money is withdrawn before the account holder reaches the age of sixty-five. Millions of dollars have accumulated in the special accounts, so the government’s plan is obviously working.
Which of the following, if true, most seriously weakens the argument?

A. A substantial number of Levaskans have withdrawn at least some of the money they had invested in the special accounts.
B. Workers in Levaska who already save money in long-term tax-free accounts that are offered through their workplace cannot take advantage of the special savings accounts introduced by the government.
C. The rate at which interest earned on money deposited in regular savings accounts is taxed depends on the income bracket of the account holder.
D. Many Levaskans who already had long-term savings have steadily been transferring those savings into the special accounts.
E. Many of the economists who now claim that the government’s plan has been successful criticized it when it was introduced.


I choose D.

I re-read each answer 3 times. To weaken the argument, you have to pick the answer that shows either a pre-existing condition allowing the current condition to exist, or an outside variable causing the current condition to come forth. D accomplishes that.
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 14 May 2008, 20:29
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Great Question. D is best.
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 14 May 2008, 20:39
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I re-read each answer 3 times. To weaken the argument, you have to pick the answer that shows either a pre-existing condition allowing the current condition to exist, or an outside variable causing the current condition to come forth. D accomplishes that.

Yes D is correct. It only states why govt plan is not working. That is million accumulate to these accounts from other accounts and not due to new savings.
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 14 May 2008, 21:20
Argument: Special account increased the savings.
Weaken: If increase in account is due to transfer of other savings deposits then will weakens the argument.


A. A substantial number of Levaskans have withdrawn at least some of the money they had invested in the special accounts. [Definitely does not address increase in savings - eliminate it]
B. Workers in Levaska who already save money in long-term tax-free accounts that are offered through their workplace cannot take advantage of the special savings accounts introduced by the government. [Strengthens the argument – eliminate it]
C. The rate at which interest earned on money deposited in regular savings accounts is taxed depends on the income bracket of the account holder. [Tax and Tax bracket is out of scope – eliminate it]
D. Many Levaskans who already had long-term savings have steadily been transferring those savings into the special accounts. [Hold it]
E. Many of the economists who now claim that the government’s plan has been successful criticized it when it was introduced. [Out of scope – eliminate it]

Answer: D
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 15 May 2008, 10:44
(-) to encourage L's citizen to put $'s in savings act -> L's govt. Plan
Plan : 3K in account with No Tax due ON INTEREST unless $'s withrdrawn before acc.holder reaches 65.
Millions in special accounts -> Govt's plan is working (conclusion)

May be the millions are coming from some rich folks that are close to retirement !


saravalli wrote:
Five years ago, as part of a plan to encourage citizens of Levaska to increase the amount of money they put into savings, Levaska’s government introduced special savings accounts in which up to $3,000 a year can be saved with no tax due on the interest unless money is withdrawn before the account holder reaches the age of sixty-five. Millions of dollars have accumulated in the special accounts, so the government’s plan is obviously working.
Which of the following, if true, most seriously weakens the argument?

A. A substantial number of Levaskans have withdrawn at least some of the money they had invested in the special accounts.
>> The aim of the govt was to encourage citizens to put more money into savings. So, if people keep withdrawing it weakens the argument.

B. Workers in Levaska who already save money in long-term tax-free accounts that are offered through their workplace cannot take advantage of the special savings accounts introduced by the government.
>> This only talks about workers in Levaska. What if only 1% of Levaska worked sounds crazy but we dont have information about workers vs the rest of population.
C. The rate at which interest earned on money deposited in regular savings accounts is taxed depends on the income bracket of the account holder.
>> Irrelevant.
D. Many Levaskans who already had long-term savings have steadily been transferring those savings into the special accounts.
>> Opposite of what we want.
E. Many of the economists who now claim that the government’s plan has been successful criticized it when it was introduced.
>>Irrelevant.
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 15 May 2008, 10:46
I was too quick to eliminate D. How silly :(
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 15 May 2008, 23:38
saravalli wrote:
OA is D. Thanks :-D


saravalli, I think D strengthen, rather than weaken the plan! Do you think so? for me, E just weaken the plan!
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 03 Aug 2008, 12:41
Five years ago, as part of a plan to encourage citizens of Levaska to increase the amount of money they put into savings, Levaska’s government introduced special savings accounts in which up to $3,000 a year can be saved with no tax due on the interest unless money is withdrawn before the account holder reaches the age of sixty-five. Millions of dollars have accumulated in the special accounts, so the government’s plan is obviously working.
Which of the following, if true, most seriously weakens the argument?
A. A substantial number of Levaskans have withdrawn at least some of the money they had invested in the special accounts.
B. Workers in Levaska who already save money in long-term tax-free accounts that are offered through their workplace cannot take advantage of the special savings accounts introduced by the government.
C. The rate at which interest earned on money deposited in regular savings accounts is taxed depends on the income bracket of the account holder.
D. Many Levaskans who already had long-term savings have steadily been transferring those savings into the special accounts.
E. Many of the economists who now claim that the government’s plan has been successful criticized it when it was introduced.
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 25 Aug 2009, 08:18
is the OA correct for this one?????

please advise

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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 25 Aug 2009, 16:55
D, as it's just one kind of saving transforming into another...
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 27 Aug 2009, 10:27
D for me too.

It weaken the statement by showing that the money in the special account came from the saving account that are already in the bank, it's not the new deposit money. So the saving money is not increase, it only transfer to a new account.
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 28 Aug 2009, 08:36
IMO D as it correctly weaken the argument that it is the govt plan that has led to the increase in savings amongst people of Lavaska..
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 20 Oct 2011, 09:10
Guys ... this is a Gmat prep 2 question... Marked D as an option and it was incorrect...

OA is B according to Gmat Prep.....
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 21 Oct 2011, 07:34
abhi398 wrote:
Guys ... this is a Gmat prep 2 question... Marked D as an option and it was incorrect...

OA is B according to Gmat Prep.....

Hey

Can you check the OA again? B seems out of scope to me...
Premise: the government plans to increase the saving by introducing a special savings account
Premise: Millions of dollars have accumulated in the special accounts
Conclusion: so the government's plan is obviously working

Which of the following, if true, most seriously weakens the argument?

A. A substantial number of Levaskans have withdrawn at least some of the money they had invested in the special accounts. -- this choice does not undermine the conclusion. it focuses on the money withdrawing of the citizens --->irrelevant
B. Workers in Levaska who already save money in long-term tax-free accounts that are offered through their workplace cannot take advantage of the special savings accounts introduced by the government -- the fact that workers cannot take advantage of the special savings accounts can't weaken the conclusion; other people can still benefit from the government's plan!
C. The rate at which interest earned on money deposited in regular savings accounts is taxed depends on the income bracket of the account holder. -- the focus of this choice is interest rate, hence irrelevant
D. Many Levaskans who already had long-term savings have steadily been transferring those savings into the special accounts. -- this choice seems ok to me.
E. Many of the economists who now claim that the government's plan has been successful criticized it when it was introduced. --this choice doesn't have any impact on the conclusion
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 05 Nov 2011, 00:24
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Quote:
Five years ago, as part of a plan to encourage citizens of Levaska to increase the amount of money they put into savings, Levaska’s government introduced special savings accounts in which up to $3,000 a year can be saved with no tax due on the interest unless money is withdrawn before the account holder reaches the age of sixty-five. Millions of dollars have accumulated in the special accounts, so the government’s plan is obviously working.


Premise 1: 5 yrs ago, L's government plan to encourage L's citizens put more (increase) money in savings
Premise 2: Special savings account in which $3,000 a year can be saved with no tax on interest
Premise 3: If the money is withdrawn before the account holder read 65 age, interest will be taxed
Premise 4: Special accounts got million dollar
Conclusion: The plan (encouraging to put more money in bank) is good

Which of the following, if true, most seriously weakens the argument?

A. A substantial number of Levaskans have withdrawn at least some of the money they had invested in the special accounts. => quite attack, but they do not withdraw all money. Savings accounts are still efficient in accumulate money
B. Workers in Levaska who already save money in long-term tax-free accounts that are offered through their workplace cannot take advantage of the special savings accounts introduced by the government. => totally irrelevant
C. The rate at which interest earned on money deposited in regular savings accounts is taxed depends on the income bracket of the account holder. => out of scope. We are talking about special ones
D. Many Levaskans who already had long-term savings have steadily been transferring those savings into the special accounts. => This one worked. It attack the plan, the money in banks did not increase significantly. Instead, it almost remained
E. Many of the economists who now claim that the government’s plan has been successful criticized it when it was introduced. => Strengthen and quite out of scope
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Re: Five years ago, as part of a plan to encourage citizens of  [#permalink]

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New post 07 Mar 2015, 22:27
mymba99 wrote:
Five years ago, as part of a plan to encourage citizens of Levaska to increase the amount of money they put into savings, Levaska’s government introduced special savings accounts in which up to $3,000 a year can be saved with no tax due on the interest unless money is withdrawn before the account holder reaches the age of sixty-five. Millions of dollars have accumulated in the special accounts, so the government’s plan is obviously working.
Which of the following, if true, most seriously weakens the argument?

A. A substantial number of Levaskans have withdrawn at least some of the money they had invested in the special accounts.
B. Workers in Levaska who already save money in long-term tax-free accounts that are offered through their workplace cannot take advantage of the special savings accounts introduced by the government.
C. The rate at which interest earned on money deposited in regular savings accounts is taxed depends on the income bracket of the account holder.
D. Many Levaskans who already had long-term savings have steadily been transferring those savings into the special accounts.
E. Many of the economists who now claim that the government’s plan has been successful criticized it when it was introduced.



what is the source of this question ? i have noticed a large incidents of confusing answers whenever the question is not from an official source.
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Re: Five years ago, as part of a plan to encourage citizens of &nbs [#permalink] 07 Mar 2015, 22:27

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