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# The 38 corporations that filed United States income tax

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Director
Joined: 01 Apr 2008
Posts: 873

Kudos [?]: 844 [0], given: 18

Name: Ronak Amin
Schools: IIM Lucknow (IPMX) - Class of 2014
The 38 corporations that filed United States income tax [#permalink]

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22 Sep 2009, 02:21
00:00

Difficulty:

(N/A)

Question Stats:

63% (03:07) correct 38% (03:37) wrong based on 9 sessions

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The 38 corporations that filed United States income tax returns showing a net income of
more than \$ 100 million accounted for 53 percent of the total taxable income from foreign
sources reported on all tax returns. Sixty percent of the total taxable income from foreign
sources came from the 200 returns reporting income from 10 or more countries.

If the statements above are true, which of the following must also be true?

A. Most of the total taxable income earned by corporations with net income above \$ 100
million was earned from foreign sources.
B. Wealthy individuals with large personal incomes reported 47 percent of the total taxable
income from foreign sources.
C. Income from foreign sources amounted to between 53 and 60 percent of all reported
taxable income.
D. Some of the corporations with net income above \$ 100 million reported income from 10 or
more countries.
E. Most of the tax returns showing income from 10 or more countries reported net income of
more than \$ 100 million.

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Manager
Joined: 21 May 2009
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Re: Data packed:) [#permalink]

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22 Sep 2009, 08:46
no idea can some one help me out with this

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Manager
Joined: 09 Mar 2009
Posts: 84

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Schools: Duke , Darden , Tuck , Ross
Re: Data packed:) [#permalink]

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23 Sep 2009, 13:53
Its D
If 38 tax returns in one category account for 53 percent of the total taxable income from foreign sources, and if 200 tax returns in another category account for 60 percent of the same amount, then the two categories must overlap to some extent. Only if the two percentages, added together, amounted to 100 percent or less is there not necessarily any overlap. Here, the two percentages add up to 113 percent. The answer choice that expresses an overlap between the category of corporations with a net income of above \$ 100 million and that of corporations with income from 10 or more countries is.

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Director
Joined: 27 Jun 2008
Posts: 540

Kudos [?]: 69 [0], given: 92

WE 1: Investment Banking - 6yrs
Re: Data packed:) [#permalink]

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23 Sep 2009, 14:07
Tough one! I don't know if this is GMAT material; there are definately tough CR's on the actual GMAT, but this one is a stretch.

Nevertheless, I'll try.

B,C,E - out of scope.

A&D - I have no clue, I would go with A...but again, not sure.

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Current Student
Joined: 16 Jan 2009
Posts: 186

Kudos [?]: 52 [0], given: 62

Location: Ithaca, New York
Schools: Cornell University - The Johnson School
Re: Data packed:) [#permalink]

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23 Sep 2009, 19:14
Economist wrote:
The 38 corporations that filed United States income tax returns showing a net income of
more than \$ 100 million accounted for 53 percent of the total taxable income from foreign
sources reported on all tax returns. Sixty percent of the total taxable income from foreign
sources came from the 200 returns reporting income from 10 or more countries.

If the statements above are true, which of the following must also be true?

A. Most of the total taxable income earned by corporations with net income above \$ 100
million was earned from foreign sources.
B. Wealthy individuals with large personal incomes reported 47 percent of the total taxable
income from foreign sources.
C. Income from foreign sources amounted to between 53 and 60 percent of all reported
taxable income.
D. Some of the corporations with net income above \$ 100 million reported income from 10 or
more countries.
E. Most of the tax returns showing income from 10 or more countries reported net income of
more than \$ 100 million.

I believe the answer is D.

Reasoning: 38 corps showing a net income of more than \$ 100 million accounted for 53% of the total taxable income from foreign
sources and 60% of the total taxable income from foreign sources came from the 200 returns reporting income from 10 or more countries. That means that some of the 38 corporations are included in the 200 corporations that filed returns that reported income from 10 or more countries. Therefore, some of the 38 corporations reported income from 10 or more countries.

Kudos [?]: 52 [0], given: 62

Director
Joined: 01 Apr 2008
Posts: 873

Kudos [?]: 844 [0], given: 18

Name: Ronak Amin
Schools: IIM Lucknow (IPMX) - Class of 2014
Re: Data packed:) [#permalink]

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23 Sep 2009, 19:55
Bingo! Its D.

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Manager
Joined: 06 Mar 2010
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Re: Data packed:) [#permalink]

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05 Jul 2010, 15:02
Its close between A & D.
A does not take the whole stimulus into account. It just draws its conclusion from the first sentence.
D option concludes from both the sentences and with proper reasoning as mentioned in above posts.

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Kaplan GMAT Instructor
Joined: 25 Aug 2009
Posts: 644

Kudos [?]: 302 [1], given: 2

Location: Cambridge, MA
Re: Data packed:) [#permalink]

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05 Jul 2010, 20:29
1
KUDOS
Expert's post
abhas59 wrote:
Its close between A & D.
A does not take the whole stimulus into account. It just draws its conclusion from the first sentence.
D option concludes from both the sentences and with proper reasoning as mentioned in above posts.
Hi Abhas,

The correct answer has already been identified--you nailed it, it's D. This is a classic scenario tested by both the LSAT and the GMAT (and one of the few; I don't recommend relying on LSAT problems for GMAT prep).

However, I want to point out that your reasoning for eliminating (A) is a trap. Inference questions simply ask what must be true--and it doesn't matter whether the correct answer must be true based on a complex, well reasoned synthesis of the entire passage, or because of a single line buried in a complex prompt. It's impossible to predict how much of the stimulus will actually be used in the correct answer.

In this case, (A) is wrong because it distorts the facts; we know that most foreign income comes from 100mil companies, but that does not necessarily mean that most 100mill income came from foreign sources.
_________________

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Manager
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Re: Data packed:) [#permalink]

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07 Jul 2010, 10:06
Thanks to correct my error. Kudos +1.

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Manager
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Re: Data packed:) [#permalink]

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07 Jul 2010, 10:47
It's D. the 53%-60% figure suggests an overlap between the two types of revenue, hence D.

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Manager
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Re: Data packed:) [#permalink]

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07 Jul 2010, 12:12
D looked correct
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Amar
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VP
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Re: Data packed:) [#permalink]

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13 Jul 2010, 15:04
D for me too.

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Manager
Joined: 09 Jul 2010
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Re: Data packed:) [#permalink]

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17 Jul 2010, 05:31
abhas59 wrote:
Its close between A & D.
A does not take the whole stimulus into account. It just draws its conclusion from the first sentence.
D option concludes from both the sentences and with proper reasoning as mentioned in above posts.

i thought that the ans is A but u hav realy nailed it budy.
_________________

consider cudos if you like my post

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Senior Manager
Joined: 14 Jun 2010
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Re: Data packed:) [#permalink]

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27 Aug 2010, 04:25
go with D....took time to understand the Q...was down to A and D.

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Senior Manager
Joined: 23 May 2010
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Re: Data packed:) [#permalink]

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28 Aug 2010, 01:35
D...picked staright away ...

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Re: Data packed:)   [#permalink] 28 Aug 2010, 01:35
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# The 38 corporations that filed United States income tax

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