Let’s consider the structure of the passage first:

• Economists claim low taxes lead to economic growth and national prosperity.
• Country X has high taxes, and Country Y has lower taxes.
• Country X has greater per-capita income than Country Y.
• Using the example of Countries X and Y, some politicians conclude that “high taxes do not hinder national prosperity.” This seems to contradict the economists’ earlier opinion that low taxes would stimulate growth and that high taxes would presumably hinder national prosperity.

The question then asks us to identify a criticism to which the politicians’ reasoning is vulnerable. With that in mind, let’s consider the answer choices.


(A) suggests that Country X could reduce its taxes and still not experience greater prosperity. But this is exactly what the politicians are arguing. They claim that keeping taxes high does not hinder national prosperity, and (A) confirms that lowering taxes would not increase national prosperity. Eliminate (A).


The wording of (B) can seem confusing, but remember the politicians’ argument. They claim that high taxes (“a factor”) do not hinder national prosperity. But do they confuse that claim with the claim that high taxes (“the same factor”) promote national prosperity? Well, no. Their conclusion remains that high taxes do not hinder national prosperity. They never take the next step and suggest that high taxes promote national prosperity. So, they do not confuse the two claims (B) outlines, and we can eliminate it.


The politicians conclude that the level of taxes in Countries X and Y explains the discrepancy in per-capita income. But (C) introduces the possibility that factors other than taxation influence per-capita income. For example, it’s possible that Country X is more abundant in national resources than Country Y or that Country X is more technologically advanced than Country Y. If either of these is the case, then high taxes could hinder national prosperity in Country X, but not to the extent that per-capita income in Country X falls below that of Country Y. The politicians fail to consider this possibility, so let’s keep (C).


The politicians’ argument assumes that the per-capita income of a country is a reliable indicator of that country’s national prosperity. However, it does not assume that per-capita income DETERMINES the rate of economic growth. Eliminate (D).


The economists’ thesis is that low taxes spur economic growth and thus lead to greater national prosperity. On the other hand, the politicians claim that high taxes do not hinder national prosperity. So, rather than assume the economists’ thesis is correct, the politicians suggest that the economists’ thesis is incorrect. Eliminate (E).

(C) is the best answer choice.

I hope that helps!
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Basically the argument says,

Reducing tax will help to grow the economy in X.

But Y has high tax and high growth. so, the assumption is wrong.


Now, if you think logically without reading the option. The flaw is that author compares two countries output without considering other economic factors.(like comparing a developed country with underdeveloped country).

check for the options to eliminate.

A- actually supports the argument. Eliminate

B- politician didn't confuses both. Eliminate

C. This is what we are looking for they didn't consider the other relevant factor.- Correct

D. Relation between per-capita income and economic growth is not an issue here.Eliminate

E. No politicians disagreed with economist. so this asumption is not required.Eliminate

Many economists hold that keeping taxes low helps to spur economic growth, and that low taxes thus lead to greater national prosperity. But Country X, which has unusually high taxes, has greater per-capita income than the neighboring Country Y, which has much lower taxes. Some politicians have concluded from this that high taxes do not hinder national prosperity.

The politicians' reasoning is most vulnerable to criticism on which of the following grounds?


A) It overlooks the possibility that even if Country X reduced its taxes, it would not experience greater national prosperity in the long term. -- Current tax structure and national prosperity is being discussed in the passage. Leng-term prosperity is irrelevant

B) It confuses a claim that a factor does not hinder a given development with the claim that the same factor promotes that development. -- Politicians never argued that high tax is cause of country X's prosperity. Wrong inference.

C) It fails to adequately address the possibility that Country X and Country Y differ in relevant respects other than taxation. -- CORRECT, the politicians are not taking other variables for Country X's national prosperity into account and are just focusing on one aspect of the economy.

D) It fails to take into account that the per-capita income of a country does not determine its rate of economic growth. -- Although it could be true, the politicians are not basing their conclusion on per-capita income, rather on high-taxation

E) It assumes that the economists' thesis must be correct despite a clear counterexample to that thesis. -- Economists' theory doesn't take high taxation into account. We can't infer the counterexample from their theory.

A) It overlooks the possibility that even if Country X reduced its taxes, it would not experience greater national prosperity in the long term. - Irrelevant Doesn't mention Long Term National prosperity

B) It confuses a claim that a factor does not hinder a given development with the claim that the same factor promotes that development. - Opposite of the Inference - Politicians never argued that high tax promotes National prosperity.

C) It fails to adequately address the possibility that Country X and Country Y differ in relevant respects other than taxation. - CORRECT, Politicians compare two countries without considering factors other than Taxation.

D) It fails to take into account that the per-capita income of a country does not determine its rate of economic growth. - Irrelevant.

E) It assumes that the economists' thesis must be correct despite a clear counterexample to that thesis. -Out Of Scope.

1: low taxes ==> economic growth
2. Low taxes == > national prosperity

3. Higher taxes has high GDP ( no relation known in statement)


Conclusion: high taxes ==> national prosperity ( 1+2+3)

4. What is difference between X and Y?
Given is about high per capita income in high taxes country AND low per capita income in low taxes country.

Gap Analysis: If we find some hint that high taxes and per capita income has no direct relationship then we can weaken or strengthen the conclusion.
Weaken: high GDP is due to high taxes and thus overall economy can be improved

Why not answer optionD?
It fails to take into account that the per-capita income of a country does not determine its rate of economic growth.
>> Conclusion is based without knowing further information about any relationship as mentioned in statement 3.
Knowing this relationship can help us to strengthen or weaken the conclusion.

WHY NOT ANSWER D as knowing the relationship between taxes and per capita income is important to reach a conclusion.


WHY C option?

In option C: It fails to adequately address the possibility that Country X and Country Y differ in relevant respects other than taxation.
(Fundamentals are still same: low taxes could mean high economic growth (even overall economy could be higher or lower)
The relationship on taxation with national prosperity (economic growth) in between X and Y OR per capita with tax is not clearly defined.


Pleas help to differentiate between C and D
BrentGMATPrepNow GMATNinja AjiteshArun VeritasKarishma

Politicians don't change the basics that low taxes helps to spur economic growth
politicians just think high taxes could also result in national prosperity

in optionD: It fails to take into account that the per-capita income of a country does not determine its rate of economic growth.

is irrelevant because there is no relation mentioned with economic growth and we are interested to know w.r.t. national prosperity which may or may not depend on economic growth.
national prosperity can happen due to various other factors even though high taxes.

if think if the option D :It fails to take into account that the per-capita income of a country does not determine its "national prosperity ", then probably D could have been an answer?

In some cases, we find that because X and Y may not have same relevant conditions so we can not determine the same outcome. ( as in above question) - not relevant as both subjects could have differences.

However in some case, it is mentioned that even X and Y may not have same relevant conditions but it gives a reasoning to think that it may happen. ( as in below question)- a general consideration



C : this is an example where the generalized conclusion is countered.

As in questions it is always asked MOST weaken or MOST strengthen , Is there any way that we can differentiate when to consider that X and Y may bring the same output and in what cases it should not be considered as general consideration.