Technext wrote:
Current farm policy is institutionalized penalization of consumers. It increases food prices for middle- and low-income families and costs the taxpayer billions of dollars a year.
Which of the following statements, if true, would provide support for the author’s claims above?
Explanation:
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I. Farm subsidies amount to roughly $20 billion a year in federal payouts and $12 billion more in higher food prices. ---> Correct. This option just looks like a restatement of the premise (the only difference is that they have added numbers instead of words).
II. According to a study by the Department of Agriculture, each $1 of benefits provided to farmers for ethanol production costs consumers and taxpayers $4. ---> Clearly provides support for author's claim. Benefit ($1) provided to the farmers is not going to come from money plant; it will come from the taxpayers. Also, increase in production cost will be reflected in increased food prices, which will affect consumers.
III. The average full-time farmers have an average net worth of over $300,000. ---> Irrelevant. How does it show that the farm policy is penalizing consumers and taxpayers?
(A) I only
(B) II only
(C) III only
(D) I and II only
(E) I, II, and III
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Clearly, option D.
Hope that helps.
Regards,
Technext
I do not understand the underlying assumption here. It is not explicit in the first option that the subsidies are being financed by tax. Government can also use sovereign bonds to finance the capital. All I want to bring out is that the whole point of CR is to judge on the basis of provided information and to forget the previous knowledge of subject. Hence, I don't think first option stands. Please correct me.