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Senator: The average per-capita after-tax income for

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Manager
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Senator: The average per-capita after-tax income for [#permalink]

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22 Jan 2006, 01:32
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Senator: The average per-capita after-tax income for residents of Eastbury is \$30,105. 2 years ago, it was 11% lower. This can be directly attributed to the comprehensive set of tax cuts that I helped get approved in Congress.

Which of the following, if true, most strengthens the conclusion drawn by the Senator?

A) The average per-capita after-tax income for residents of Eastbury who fall below the poverty line increased by 16% in the last 5 years.
B) The Senator has not personally benefited from the tax cuts.
C) The no of residents of Eastbury has not substantially changed in the last two years.
D) The Federal tax rate increased 6% during the four years prior to the implementation of tax cuts.
E) A recent change in the state laws did not substantially increase the average per-capita after-tax income of the residents of Eastbury.

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22 Jan 2006, 07:41
A) The average per-capita after-tax income for residents of Eastbury who fall below the poverty line increased by 16% in the last 5 years.
No. Weakening...
B) The Senator has not personally benefited from the tax cuts.
No. OOS
C) The no of residents of Eastbury has not substantially changed in the last two years.
No. OOS
D) The Federal tax rate increased 6% during the four years prior to the implementation of tax cuts.
No. OOS
E) A recent change in the state laws did not substantially increase the average per-capita after-tax income of the residents of Eastbury.
Correct. Since state tax change did not increase after-tax income, then the federal tax did.

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VP
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Re: CR - Senator tax cuts [#permalink]

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22 Jan 2006, 09:12
betwen C and E, go with E.

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Director
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22 Jan 2006, 09:49
Agree with your effcient explanation, E

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22 Jan 2006, 11:44
Defenitely have to agree with the explanation of ceo!

E should be it. If senator's tax cut's have to be the sole cause, there shouldn't be any other changes in the tax laws.
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Director
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22 Jan 2006, 16:12
Its between C and E
but i m more inclined towards C...
In E ,we dont know about which laws the author is talking about..It can be any law which has no effect on taxes too

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22 Jan 2006, 21:37

In C, it specifically said that the population has not drastically changed in the last 2 years.

In E, a "recent" change in law does not say anything about what happened in the last 2 years.
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Director
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22 Jan 2006, 23:01
My vote is for C.

Basically, we need to suppress any other reason which could be responsible for the increase in the per capita income. In C, we effectively rule out that reason strengthen the argument and conclude that the income increased solely as a result of the tax cuts.

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Manager
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22 Jan 2006, 23:15
I am voting for C. Had the population drastically reduced, the per capita would have increased and hence the senator's point weakened. So if we are told that the population did not change drastically we can rule out that weakness from the senators statement and hence strengthen it.

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23 Jan 2006, 15:58
Yes I also got C with the same reasoning.

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23 Jan 2006, 16:10
I think C

Per capita after-tax income has increased in last 2 years because of tax cuts.

Just seeing the above statement, what comes in mind: Is this the real cause of the effect? What if this is not the cause. Other cause could be

1. Earning of residents have increased in last 2 years.
2. Population of the town has decreased.
etc etc...

C negates #2 above and supports the arguments.
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24 Jan 2006, 13:19
Much as I hate to say it, the ans is E. In fact, I marked C too in the test.

This is the OE:

Quote:
The CONCLUSION: The set of tax cuts caused the increase in after-tax income.

THE EVIDENCE: This is a classic case of concluding that a causal relationship exists (the tax cuts caused an increase in after-tax income) based only on a correlation (the tax cuts happenned before the increase)

If another cause can be shown to have contributed to the after-tax increase in income, then that would weaken the argument. By ruling out the possibility of an alternative cause (change in estate laws), the argument is strengthened.

According to OE, the no of residents (C) is irrelevant.

I agree with the OE till the pt where it says, if another cause can be shown to have contributed to the after-tax increase in income, then that would weaken the argument. Thus if the question asked for a weakening statement and supplied change in estate laws as a possible reason for increase of after-tax income, that could have weakened the argument as it clearly gives another possible explanation. However, the opposite is not true. There could be a 1000 other causes why after-tax income increased. E does not conclusively exclude all of them. C is obviously relevant as if population is constant, then a good reason for income increase might be decrease in taxes.

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24 Jan 2006, 13:19
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