babuvgmat wrote:
In order to improve the long-term savings rate of its citizens, Levaska’s government has decided to introduce special savings accounts, Citizens can save up to $3,000 a year in special accounts without having to pay tax on the interest, unless they withdraw money from the account before they reach the age of sixty-five. If they do withdraw any money before that age, they have to pay tax on the accumulated interest and a penalty.
Which of the following, if true, most seriously threatens the success of the government’s plan?
A. The banks and financial institutions where the special accounts will be held lobbled hard for their introduction.
B. Nearly all workers in Levaska can already save money in tax-free accounts through their workplace.
C. For the past ten years, Levaskans have been depositing an ever smaller percentage of their income in long-term savings.
D. Many Levaskans continue to work beyond the age of sixty-five.
E. In certain circumstances, such as a serious illness, the government plans to waive the penalty on early withdrawals from the special accounts.
Could anyone please help me in how B is suffice, as it just considers only workers but the answer should address all citizens
Here is my 2 cents.
The plan is to improve long term savings. This itself infers that the savings can be improved or there is scope of improvement.
To attract customers, government will give tax rebates on the interest of these savings.
Combining above statements, an assumption can be derived that tax rebates will make customers put money in savings account, increasing the overall savings. We have to attack this assumption.
A. The banks and financial institutions where the special accounts will be held lobbled hard for their introduction.
SO will the savings increase? It doesn't answer this question.B. Nearly all workers in Levaska can already save money in tax-free accounts through their workplace.
If workers are already saving money in tax free account, then why will they save in special savings accounts from Government. This weakens the argument as there is no additional benefit other than tax-free account. C. For the past ten years, Levaskans have been depositing an ever smaller percentage of their income in long-term savings.
So will they continue the same trend of saving less? No answerD. Many Levaskans continue to work beyond the age of sixty-five.
Savings are not talked about.E. In certain circumstances, such as a serious illness, the government plans to waive the penalty on early withdrawals from the special accounts.
This can be a possible strengthener
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