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# In the 1970 s there was an oversupply of college graduates.

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In the 1970 s there was an oversupply of college graduates. [#permalink]

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31 Jul 2008, 19:28
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In the 1970’s there was an oversupply of college graduates. The oversupply caused the average annual income of college graduates to fall to a level only 18 percent greater than that of workers with only high school diplomas. By the late 1980’s the average annual income of college graduates was 43 percent higher than that of workers with only high school diplomas, even though between the 1970’s and the late 1980’s the supply of college graduates did not decrease.
Which of the following, if true, in the late 1980’s, best reconciles the apparent discrepancy described above?
(A) The economy slowed, thus creating a decreased demand for college graduates.
(B) The quality of high school education improved.
(C) Compared to the 1970’s, a greater number of high schools offered vocational guidance programs for their students.
(D) The proportion of the population with at least a college-level education increased.
(E) There was for the first time in 20 years an oversupply of job seekers with only high school diplomas.
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31 Jul 2008, 19:43
spriya wrote:
In the 1970’s there was an oversupply of college graduates. The oversupply caused the average annual income of college graduates to fall to a level only 18 percent greater than that of workers with only high school diplomas. By the late 1980’s the average annual income of college graduates was 43 percent higher than that of workers with only high school diplomas, even though between the 1970’s and the late 1980’s the supply of college graduates did not decrease.
Which of the following, if true, in the late 1980’s, best reconciles the apparent discrepancy described above?
(A) The economy slowed, thus creating a decreased demand for college graduates.
(B) The quality of high school education improved.
(C) Compared to the 1970’s, a greater number of high schools offered vocational guidance programs for their students.
(D) The proportion of the population with at least a college-level education increased.
(E) There was for the first time in 20 years an oversupply of job seekers with only high school diplomas.

IMO E)

A) should have decreased salary diff
B) should have decreased salary diff
C) is irrelevant
D) can affect stats both ways.
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01 Aug 2008, 21:32
nmohindru wrote:
spriya wrote:
In the 1970’s there was an oversupply of college graduates. The oversupply caused the average annual income of college graduates to fall to a level only 18 percent greater than that of workers with only high school diplomas. By the late 1980’s the average annual income of college graduates was 43 percent higher than that of workers with only high school diplomas, even though between the 1970’s and the late 1980’s the supply of college graduates did not decrease.
Which of the following, if true, in the late 1980’s, best reconciles the apparent discrepancy described above?
(A) The economy slowed, thus creating a decreased demand for college graduates.
(B) The quality of high school education improved.
(C) Compared to the 1970’s, a greater number of high schools offered vocational guidance programs for their students.
(D) The proportion of the population with at least a college-level education increased.
(E) There was for the first time in 20 years an oversupply of job seekers with only high school diplomas.

IMO E)

A) should have decreased salary diff
B) should have decreased salary diff
C) is irrelevant
D) can affect stats both ways.

E is the OA
Whenever supply is high automatically value of the same falls .this is explained in E
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02 Aug 2008, 10:55
got it.
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20 Jul 2011, 22:55
E is correct. After reading a convoluted premise I actually expected trickier answer choices, but E was pretty straight forward.
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21 Jul 2011, 02:45
i marked D
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Re: In the 1970 s there was an oversupply of college graduates. [#permalink]

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04 Jul 2012, 07:28
Why is it not A? If the demand decreases, the average rate should increase, which explains why the increase to 43%.. Someone please explain
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Re: In the 1970 s there was an oversupply of college graduates. [#permalink]

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04 Jul 2012, 11:00
ivinayak wrote:
Why is it not A? If the demand decreases, the average rate should increase, which explains why the increase to 43%.. Someone please explain

I think because the question says:

Which of the following, if true, in the late 1980’s, best reconciles the apparent discrepancy described above?

If the economy slowed, as A suggested, in the 80's, you wouldn't expect to see an increase in wages?
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Re: In the 1970 s there was an oversupply of college graduates. [#permalink]

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04 Jul 2012, 12:45
+1 for (E)
More job seekers---->reduced pay
1970s
more degree guys---->lesser difference of pay between high school guys and degree guys.
1980s
degree guys ----->higher difference of pay between high school guys and degree guys.
It means either the no. of degree guys has dropped OR the number of high school guys has galloped.
Since,the no.of degree guys is constant then definitely the high school guys would have faced oversupply of human resources in 1980s period as the degree holder guys faced during 1970s.
(E) wins.
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Re: In the 1970 s there was an oversupply of college graduates.   [#permalink] 04 Jul 2012, 12:45
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