It is currently 20 Nov 2017, 01:28

Close

GMAT Club Daily Prep

Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track
Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.

Close

Request Expert Reply

Confirm Cancel

Events & Promotions

Events & Promotions in June
Open Detailed Calendar

Large national budget deficits do not cause large trade deficits. If t

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
TAGS:

Hide Tags

3 KUDOS received
Manager
Manager
avatar
Joined: 04 Dec 2008
Posts: 104

Kudos [?]: 230 [3], given: 2

Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 27 Oct 2009, 06:02
3
This post received
KUDOS
5
This post was
BOOKMARKED
00:00
A
B
C
D
E

Difficulty:

  5% (low)

Question Stats:

81% (01:08) correct 19% (01:13) wrong based on 1202 sessions

HideShow timer Statistics

Large national budget deficits do not cause large trade deficits. If they did, countries with the largest budget deficits would also have the largest trade deficits. In fact, when deficit figures are adjusted so that different countries are reliably comparable to each other, there is no such correlation.

If the statements above are all true, which of the following can properly be inferred on the basis of them?

(A) Countries with large national budget deficits tend to restrict foreign trade.
(B) Reliable comparisons of the deficit figures of one country with those of another are impossible.
(C) Reducing a country’s national budget deficit will not necessarily result in a lowering of any trade deficit that country may have.
(D) When countries are ordered from largest to smallest in terms of population, the smallest countries generally have the smallest budget and trade deficits.
(E) Countries with the largest trade deficits never have similarly large national budget deficits.
[Reveal] Spoiler: OA

Kudos [?]: 230 [3], given: 2

2 KUDOS received
Manager
Manager
avatar
Affiliations: CFA
Joined: 18 Oct 2009
Posts: 59

Kudos [?]: 12 [2], given: 0

Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 27 Oct 2009, 10:49
2
This post received
KUDOS
Restate the premise "large national deficits may not necessarily result in large trade deficits. there is no correlation between national deficits and trade deficits"

A) Out of scope. The premise is about national deficits and trade deficits. it has nothing about trade restriction
B) False. The premise is about the correlation between national deficits and trade deficits. It has no information about comparison between deficits of different countries. In addition, the word impossible is too strong. There are no facts support such comparison is impossible.
C) Correct answer. The premise states that there is no correlation between national and trade deficits. Therefore, reducing one may or may not lead to the reduction of another.
D) The premise says nothing about population. Rule out
E) Exact opposite. The premise says there is no correlation between trade deficits and national deficits

Kudos [?]: 12 [2], given: 0

2 KUDOS received
Manager
Manager
User avatar
Joined: 20 Nov 2009
Posts: 163

Kudos [?]: 260 [2], given: 64

Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 23 Jul 2010, 03:52
2
This post received
KUDOS
7
This post was
BOOKMARKED
Official Guide for GMAT Verbal Review, 2nd Edition
Practice Question
Question No.: 12
Page: 120
Difficulty:


Large national budget deficits do not cause large trade deficits. If they did, countries with the largest budget deficits would also have the largest trade deficits. In fact, when deficit figures are adjusted so that different countries are reliably comparable to each other, there is no such correlation.

If the statements above are all true, which of the following can properly be inferred on the basis of them?
(A) Countries with large national budget deficits tend to restrict foreign trade.
(B) Reliable comparisons of the deficit figures of one country with those of another are impossible.
(C) Reducing a country’s national budget deficit will not necessarily result in a lowering of any trade deficit that country may have.
(D) When countries are ordered from largest to smallest in terms of population, the smallest countries generally have the smallest budget and trade deficits.
(E) Countries with the largest trade deficits never have similarly large national budget deficits.
_________________

But there’s something in me that just keeps going on. I think it has something to do with tomorrow, that there is always one, and that everything can change when it comes.
http://aimingformba.blogspot.com


Last edited by dentobizz on 21 Oct 2013, 22:18, edited 1 time in total.
formatting for the verbal review project

Kudos [?]: 260 [2], given: 64

3 KUDOS received
Director
Director
avatar
Status: Impossible is not a fact. It's an opinion. It's a dare. Impossible is nothing.
Affiliations: University of Chicago Booth School of Business
Joined: 26 Nov 2009
Posts: 954

Kudos [?]: 918 [3], given: 36

Location: Singapore
Concentration: General Management, Finance
Schools: Chicago Booth - Class of 2015
GMAT ToolKit User
Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 23 Jul 2010, 05:49
3
This post received
KUDOS
1
This post was
BOOKMARKED
Premise : there is no such correlation between budget deficit and trade deficit

So we can infer that reducing budget deficit will NOT necessarily reduce the trade deficit.
C is correct.

(A) Countries with large national budget deficits tend to restrict foreign trade. >> Foreign trade is Out of scope
(B) Reliable comparisons of the deficit figures of one country with those of another are impossible. >> Impossible here is wrong. It cannot be inferred from this passage.
(C) Reducing a country’s national budget deficit will not necessarily result in a lowering of any trade deficit that country may have. Answer
(D) When countries are ordered from largest to smallest in terms of population, the smallest countries generally have the smallest budget and trade deficits. >> The size of the country has no bearing on the argument. Irrelevant
(E) Countries with the largest trade deficits never have similarly large national budget deficits. >> Never is wrong. This cannot be inferred.

Kudos [?]: 918 [3], given: 36

1 KUDOS received
Manager
Manager
avatar
Affiliations: NCC,SAE,YHIA
Joined: 04 May 2010
Posts: 51

Kudos [?]: 20 [1], given: 2

Location: Mumbai , India
WE 1: 3 years international sales & mktg-projects
Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 04 Sep 2010, 14:20
1
This post received
KUDOS
Premise: When deficit figures are adjusted so that the countries can be reliably compared , no correlation is found between budget deficit and trade deficit.

Conclusion:-Large Budget deficit does not mean large trade deficit.

(A) Countries with large national budget deficits tend to restrict foreign trade.
Not relevant to argument.
(B) Reliable comparisons of the deficit figures of one country with those of another are impossible.
Argument itself closes the loophole by including "when adjusted", therefore it is irrelevant whether comparison can be made or not. Further impossible introduces extreme inference.
(C) Reducing a country’s national budget deficit will not necessarily result in a lowering of any trade deficit that country may have.
Correct, since there is no correlation between BD & TD , it is safe to infer that reducing BD may not lead to lowering of TD.
(D) When countries are ordered from largest to smallest in terms of population, the smallest countries generally have the smallest budget and trade deficits.
New information , argument does not refer to population sizes.
(E) Countries with the largest trade deficits never have similarly large national budget deficits.
"Never" exaggerates the inference, no relationship between BD & TD doesn't mean BD &TD cannot occur together.

IMO C.
_________________

Sun Tzu-Victorious warriors win first and then go to war, while defeated warriors go to war first and then seek to win.

Kudos [?]: 20 [1], given: 2

3 KUDOS received
Manager
Manager
avatar
Joined: 28 Sep 2011
Posts: 200

Kudos [?]: 96 [3], given: 5

Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 17 Mar 2012, 08:49
3
This post received
KUDOS
I chose C for this question:

A. This answer may or may not be true - there is not enough information within the stimulus to say that this answer is true.

B. This answer choice directly counters a statement within the stimulus. The stimulus says "when deficit figures are adjusted so that different countries are reliably comparable to each other..."

C. This is a good inference. The reason is because it essentially restates that large national budget deficits and large trade deficits have no correlation.

D. We are not concerned with ordering countries from largest to smallest population - this answer choice is irrelevant. Also, the smallest countries may or may not have the smallest budget and trade deficits - there is nothing within the stimulus to suggest this answer.

E. Firstly, the word "never have" is very strong - I was a bit suspicious of this. Also, I knew that this wasn't true because there is actually no correlation between large national budget deficits and large trade deficits as stated in the last sentence. Therefore, this answer choice can't be correct.

Kudos [?]: 96 [3], given: 5

2 KUDOS received
Manager
Manager
User avatar
Joined: 31 Aug 2011
Posts: 224

Kudos [?]: 261 [2], given: 56

Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 24 Aug 2012, 00:35
2
This post received
KUDOS
Large national budget deficits do not cause large trade deficits. If they did, countries with the largest budget deficits would also have the largest trade deficits. In fact, when deficit figures are adjusted so that different countries are reliably comparable to each other, there is no such correlation.
If the statements above are all true, which of the following can properly be inferred on the basis of them?
(A) Countries with large national budget deficits tend to restrict foreign trade.
(B) Reliable comparisons of the deficit figures of one country with those of another are impossible.
(C) Reducing a country’s national budget deficit will not necessarily result in a lowering of any trade deficit that country may have.
(D) When countries are ordered from largest to smallest in terms of population, the smallest countries generally have the smallest budget and trade deficits.
(E) Countries with the largest trade deficits never have similarly large national budget deficits.
_________________

If you found my contribution helpful, please click the +1 Kudos button on the left, I kinda need some =)

Kudos [?]: 261 [2], given: 56

Intern
Intern
avatar
Joined: 21 Aug 2012
Posts: 26

Kudos [?]: 7 [0], given: 4

Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 24 Aug 2012, 03:31
PUNEETSCHDV wrote:
Large national budget deficits do not cause large trade deficits. If they did, countries with the largest budget deficits would also have the largest trade deficits. In fact, when deficit figures are adjusted so that different countries are reliably comparable to each other, there is no such correlation.
If the statements above are all true, which of the following can properly be inferred on the basis of them?
(A) Countries with large national budget deficits tend to restrict foreign trade.
(B) Reliable comparisons of the deficit figures of one country with those of another are impossible.
(C) Reducing a country’s national budget deficit will not necessarily result in a lowering of any trade deficit that country may have.
(D) When countries are ordered from largest to smallest in terms of population, the smallest countries generally have the smallest budget and trade deficits.
(E) Countries with the largest trade deficits never have similarly large national budget deficits.


C is the answer for this question.
Explanation: Conclusion of the passage states that Trade Deficit is not related or dependent upon National deficit.

(A) Countries with large national budget deficits tend to restrict foreign trade. - Does not extend the conclusion
(B) Reliable comparisons of the deficit figures of one country with those of another are impossible. -Does not extend the conclusion
(C) Reducing a country’s national budget deficit will not necessarily result in a lowering of any trade deficit that country may have. - It is directly related to conclusion
(D) When countries are ordered from largest to smallest in terms of population, the smallest countries generally have the smallest budget and trade deficits. - Out of scope

(E) Countries with the largest trade deficits never have similarly large national budget deficits - Again it tries to form a relationship between large national budget deficits and largest trade deficits. Also usage of strong word "never" helps eleminating this option.
_________________

Please give kudos if you like my reply!

Kudos [?]: 7 [0], given: 4

BSchool Forum Moderator
avatar
Joined: 23 Jul 2010
Posts: 556

Kudos [?]: 988 [0], given: 321

GPA: 3.4
WE: General Management (Non-Profit and Government)
GMAT ToolKit User Premium Member
Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 06 Oct 2013, 13:32

Kudos [?]: 988 [0], given: 321

Non-Human User
User avatar
Joined: 01 Oct 2013
Posts: 10130

Kudos [?]: 270 [0], given: 0

Premium Member
Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 26 Apr 2014, 19:55
Hello from the GMAT Club VerbalBot!

Thanks to another GMAT Club member, I have just discovered this valuable topic, yet it had no discussion for over a year. I am now bumping it up - doing my job. I think you may find it valuable (esp those replies with Kudos).

Want to see all other topics I dig out? Follow me (click follow button on profile). You will receive a summary of all topics I bump in your profile area as well as via email.

Kudos [?]: 270 [0], given: 0

Manager
Manager
User avatar
Joined: 24 Apr 2012
Posts: 51

Kudos [?]: 84 [0], given: 33

Concentration: Strategy
WE: Project Management (Consulting)
Premium Member
Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 15 Jul 2014, 06:37
Hi All,

This question particularly is relatively very easy to solve! But there are a lot of inference questions which are based on a particular pattern recognition. Can anyone help me decipher this code?


Q . Large national budget deficits do not cause large trade deficits. If they did, countries with the largest budget deficits would also have the largest trade deficits. In fact, when deficit figures are adjusted so that different countries are reliably comparable to each other, there is no such correlation.

If the statements above are all true, which of the following can properly be inferred on the basis of them?

(A) Countries with large national budget deficits tend to restrict foreign trade.

(B) Reliable comparisons of the deficit figures of one country with those of another are impossible.

(C ) Reducing a country's national budget deficit will not necessarily result in a lowering of any trade deficit that country may have.

(D) When countries are ordered from largest to smallest in terms of population, the smallest countries generally have the smallest budget and trade deficits.

(E) Countries with the largest trade deficits never have similarly large national budget deficits.
_________________

--------------------------

"The will to win, the desire to succeed, the urge to reach your full potential..."

Useful Links:

http://gmatclub.com/forum/powerscore-cr-notes-hope-that-someone-find-it-kudosofiable-174638.html#p1384561

Kudos [?]: 84 [0], given: 33

Manager
Manager
avatar
Joined: 16 Mar 2013
Posts: 61

Kudos [?]: 15 [0], given: 11

Reviews Badge
Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 07 Aug 2014, 09:06
I feel it was between the options C and E.

I negated out option E, as the word 'never' made it a very strong negative correlation. In fact the last sentence states that there is no such correlation.

If the word, 'never' was not present, then option was lucrative as well.

But clearly option C is the correct answer.
_________________

'The best way to thank or appreciate efforts on this forum is to give Kudos.'

Kudos [?]: 15 [0], given: 11

Non-Human User
User avatar
Joined: 01 Oct 2013
Posts: 10130

Kudos [?]: 270 [0], given: 0

Premium Member
Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 07 Aug 2014, 17:28
Hello from the GMAT Club VerbalBot!

Thanks to another GMAT Club member, I have just discovered this valuable topic, yet it had no discussion for over a year. I am now bumping it up - doing my job. I think you may find it valuable (esp those replies with Kudos).

Want to see all other topics I dig out? Follow me (click follow button on profile). You will receive a summary of all topics I bump in your profile area as well as via email.

Kudos [?]: 270 [0], given: 0

Intern
Intern
avatar
Joined: 30 Oct 2011
Posts: 46

Kudos [?]: 21 [0], given: 13

GMAT ToolKit User
Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 17 Nov 2014, 02:57
aiming4mba wrote:
Official Guide for GMAT Verbal Review, 2nd Edition
Practice Question
Question No.: 12
Page: 120
Difficulty:


Large national budget deficits do not cause large trade deficits. If they did, countries with the largest budget deficits would also have the largest trade deficits. In fact, when deficit figures are adjusted so that different countries are reliably comparable to each other, there is no such correlation.

If the statements above are all true, which of the following can properly be inferred on the basis of them?
(A) Countries with large national budget deficits tend to restrict foreign trade.
(B) Reliable comparisons of the deficit figures of one country with those of another are impossible.
(C) Reducing a country’s national budget deficit will not necessarily result in a lowering of any trade deficit that country may have.
(D) When countries are ordered from largest to smallest in terms of population, the smallest countries generally have the smallest budget and trade deficits.
(E) Countries with the largest trade deficits never have similarly large national budget deficits.


Can any expert please help explain the difference in meaning between 2nd line of the passage and answer choice (B)?

Kudos [?]: 21 [0], given: 13

1 KUDOS received
Verbal Forum Moderator
User avatar
Joined: 16 Jun 2012
Posts: 1126

Kudos [?]: 3551 [1], given: 123

Location: United States
Premium Member
Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 17 Nov 2014, 16:39
1
This post received
KUDOS
mneeti wrote:
aiming4mba wrote:
Official Guide for GMAT Verbal Review, 2nd Edition
Practice Question
Question No.: 12
Page: 120
Difficulty:


Large national budget deficits do not cause large trade deficits. If they did, countries with the largest budget deficits would also have the largest trade deficits. In fact, when deficit figures are adjusted so that different countries are reliably comparable to each other, there is no such correlation.

If the statements above are all true, which of the following can properly be inferred on the basis of them?
(A) Countries with large national budget deficits tend to restrict foreign trade.
(B) Reliable comparisons of the deficit figures of one country with those of another are impossible.
(C) Reducing a country’s national budget deficit will not necessarily result in a lowering of any trade deficit that country may have.
(D) When countries are ordered from largest to smallest in terms of population, the smallest countries generally have the smallest budget and trade deficits.
(E) Countries with the largest trade deficits never have similarly large national budget deficits.


Can any expert please help explain the difference in meaning between 2nd line of the passage and answer choice (B)?


Hello mneeti.

The 2nd line of the stimulus says: when deficit figures are adjusted so that different countries are reliably comparable to each other, there is no such correlation.

It means when deficit figures are adjusted to a comparable levels --> there is NO correlation "countries with the largest budget deficits would also have the largest trade deficits".

Do not be confused the term "such correlation".

Option B, however, says the deficit figures of one country with those of another can't be compared. That's wrong. They are different, but can be adjusted to a comparable levels.

Hope it helps.
_________________

Please +1 KUDO if my post helps. Thank you.

"Designing cars consumes you; it has a hold on your spirit which is incredibly powerful. It's not something you can do part time, you have do it with all your heart and soul or you're going to get it wrong."

Chris Bangle - Former BMW Chief of Design.

Kudos [?]: 3551 [1], given: 123

Non-Human User
User avatar
Joined: 01 Oct 2013
Posts: 10130

Kudos [?]: 270 [0], given: 0

Premium Member
Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 07 Jun 2016, 14:44
Hello from the GMAT Club VerbalBot!

Thanks to another GMAT Club member, I have just discovered this valuable topic, yet it had no discussion for over a year. I am now bumping it up - doing my job. I think you may find it valuable (esp those replies with Kudos).

Want to see all other topics I dig out? Follow me (click follow button on profile). You will receive a summary of all topics I bump in your profile area as well as via email.

Kudos [?]: 270 [0], given: 0

Non-Human User
User avatar
Joined: 01 Oct 2013
Posts: 10130

Kudos [?]: 270 [0], given: 0

Premium Member
Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 11 Jul 2016, 02:03
Hello from the GMAT Club VerbalBot!

Thanks to another GMAT Club member, I have just discovered this valuable topic, yet it had no discussion for over a year. I am now bumping it up - doing my job. I think you may find it valuable (esp those replies with Kudos).

Want to see all other topics I dig out? Follow me (click follow button on profile). You will receive a summary of all topics I bump in your profile area as well as via email.

Kudos [?]: 270 [0], given: 0

Verbal Forum Moderator
User avatar
D
Status: Greatness begins beyond your comfort zone
Joined: 08 Dec 2013
Posts: 1597

Kudos [?]: 1004 [0], given: 80

Location: India
Concentration: General Management, Strategy
GPA: 3.2
WE: Information Technology (Consulting)
GMAT ToolKit User Reviews Badge CAT Tests
Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 15 Dec 2016, 22:43
joyseychow wrote:
Large national budget deficits do not cause large trade deficits. If they did, countries with the largest budget deficits would also have the largest trade deficits. In fact, when deficit figures are adjusted so that different countries are reliably comparable to each other, there is no such correlation.
If the statements above are all true, which of the following can properly be inferred on the basis of them?



Boil it down - There is no correlation between national budget deficit and trade deficit
Type - Inference
(A) Countries with large national budget deficits tend to restrict foreign trade. Out of scope
(B) Reliable comparisons of the deficit figures of one country with those of another are impossible. Incorrect
(C) Reducing a country’s national budget deficit will not necessarily result in a lowering of any trade deficit that country may have. Correct since there is no correlation
(D) When countries are ordered from largest to smallest in terms of population, the smallest countries generally have the smallest budget and trade deficits. Out of scope - we don't the relation of these 2 terms with population
(E) Countries with the largest trade deficits never have similarly large national budget deficits. - Large national budget deficits do not cause large trade deficits. But "never" is too strong a word in this statement . Hence , it can't be an inference

Answer C
_________________

When everything seems to be going against you, remember that the airplane takes off against the wind, not with it. - Henry Ford
The Moment You Think About Giving Up, Think Of The Reason Why You Held On So Long
+1 Kudos if you find this post helpful

Kudos [?]: 1004 [0], given: 80

Director
Director
avatar
G
Joined: 02 Sep 2016
Posts: 788

Kudos [?]: 43 [0], given: 274

Premium Member CAT Tests
Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 27 Dec 2016, 03:49
We just know that there is no such correlation between budget and trade deficits.

(A) Countries with large national budget deficits tend to restrict foreign trade. OUT OF SCOPE
(B) Reliable comparisons of the deficit figures of one country with those of another are impossible. OUT OF SCOPE (Questioning the premise)
(C) Reducing a country’s national budget deficit will not necessarily result in a lowering of any trade deficit that country may have. CORRECT.
(D) When countries are ordered from largest to smallest in terms of population, the smallest countries generally have the smallest budget and trade deficits. OUT OF SCOPE
(E) Countries with the largest trade deficits never have similarly large national budget deficits. The language is too strong when compared to option C. Thus incorrect.
_________________

Help me make my explanation better by providing a logical feedback.

If you liked the post, HIT KUDOS !!

Don't quit.............Do it.

Kudos [?]: 43 [0], given: 274

Manager
Manager
User avatar
S
Joined: 05 Dec 2016
Posts: 227

Kudos [?]: 25 [0], given: 48

Concentration: Strategy, Finance
GMAT 1: 620 Q46 V29
GMAT ToolKit User
Re: Large national budget deficits do not cause large trade deficits. If t [#permalink]

Show Tags

New post 01 Mar 2017, 06:03
Argument is "cause and effect" type, we're given that X doesn't necessarily cause Y.
C - is the right answer.
E - is a "reverse logic" trap.

Kudos [?]: 25 [0], given: 48

Re: Large national budget deficits do not cause large trade deficits. If t   [#permalink] 01 Mar 2017, 06:03

Go to page    1   2    Next  [ 25 posts ] 

Display posts from previous: Sort by

Large national budget deficits do not cause large trade deficits. If t

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  


GMAT Club MBA Forum Home| About| Terms and Conditions| GMAT Club Rules| Contact| Sitemap

Powered by phpBB © phpBB Group | Emoji artwork provided by EmojiOne

Kindly note that the GMAT® test is a registered trademark of the Graduate Management Admission Council®, and this site has neither been reviewed nor endorsed by GMAC®.