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# The deficit is the difference between the amount that the government

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Re: The deficit is the difference between the amount that the government [#permalink]
psyke119 wrote:
Options A and D both point towards not being able to raise tax revenue. I'm confused between A and D.

The deficit is the difference between the amount that the government taxes in as revenue and the amount that it spends in a given year. There are only two ways to cut the deficit: raise revenue or cut spending. The current government has carried out all possible efforts to cut spending without any significant effect on the deficit. It then follows that the deficit will remain at the current level for a few years since _________________

Which of the following best completes the passage?

A. No practical means currently exist to raise revenues.

B. The economy is stagnant and does not allow for any more industrial spending.

C. The government has to comply to international limits placed on its export contacts

D. The government is against increasing the tax burden on its citizens

E. The government is currently focusing on internal revenue management

Note that A is more airtight than D. The key sentence is “ There are only two ways to cut the deficit: raise revenue or cut spending”. Answer choice A directly addresses that there is no way to raise Revenues. Answer choice D on the other hand keeps a few backdoors open - such as the restricting word ‘citizens’. What if the government can raise revenues through exports to other countries? In that case the tax burden would not be on it’s own citizens.

bt
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Re: The deficit is the difference between the amount that the government [#permalink]
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Braintree wrote:
The deficit is the difference between the amount that the government taxes in as revenue and the amount that it spends in a given year. There are only two ways to cut the deficit: raise revenue or cut spending. The current government has carried out all possible efforts to cut spending without any significant effect on the deficit. It then follows that the deficit will remain at the current level for a few years since _________________

Which of the following best completes the passage?

A. No practical means currently exist to raise revenues.

B. The economy is stagnant and does not allow for any more industrial spending.

C. The government has to comply to international limits placed on its export contacts

D. The government is against increasing the tax burden on its citizens

E. The government is currently focusing on internal revenue management

Note that A is more airtight than D. The key sentence is “ There are only two ways to cut the deficit: raise revenue or cut spending”. Answer choice A directly addresses that there is no way to raise Revenues. Answer choice D on the other hand keeps a few backdoors open - such as the restricting word ‘citizens’. What if the government can raise revenues through exports to other countries? In that case the tax burden would not be on it’s own citizens.

bt

I have a different opinion on this

Let's see the conclusion of the argument.

Conclusion : The deficit will remain at the current level for a few years

We have to give support to the conclusion.

Let's look at A : No practical means currently exist to raise revenues.

There are two issues, I think - First the statement talks about practical means. It doesn't tell there are no means, but tells that the means are not practical. Second is the use of the word currently. If something doesn't exists currently doesn't mean it can't exist in future ( we are talking about few years, and not immediate).

Let's look at D : The government is against increasing the tax burden on its citizens

Say if the government were to increase taxes, then the deficit would go down. We already know that the spendings have been curbed to whatever extent possible, so one of the two factors have been taken care of.

This option rules out any alternate possibility.

Hence this statement lends support.

IMO D

I would like to address one last point in your method of reasoning -

Braintree wrote:
What if the government can raise revenues through exports to other countries? In that case the tax burden would not be on it’s own citizens.

If the revenues are raised through other means the conclusion falls apart. It means the deficit will reduce (as the spendings are already curbed to the lowest possible). Hence we can't assume something that defies the conclusion as we need to support the same.

Would like to hear your thoughts
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Re: The deficit is the difference between the amount that the government [#permalink]
gmatophobia wrote:
Braintree wrote:
The deficit is the difference between the amount that the government taxes in as revenue and the amount that it spends in a given year. There are only two ways to cut the deficit: raise revenue or cut spending. The current government has carried out all possible efforts to cut spending without any significant effect on the deficit. It then follows that the deficit will remain at the current level for a few years since _________________

Which of the following best completes the passage?

A. No practical means currently exist to raise revenues.

B. The economy is stagnant and does not allow for any more industrial spending.

C. The government has to comply to international limits placed on its export contacts

D. The government is against increasing the tax burden on its citizens

E. The government is currently focusing on internal revenue management

Note that A is more airtight than D. The key sentence is “ There are only two ways to cut the deficit: raise revenue or cut spending”. Answer choice A directly addresses that there is no way to raise Revenues. Answer choice D on the other hand keeps a few backdoors open - such as the restricting word ‘citizens’. What if the government can raise revenues through exports to other countries? In that case the tax burden would not be on it’s own citizens.

bt

I have a different opinion on this

Let's see the conclusion of the argument.

Conclusion : The deficit will remain at the current level for a few years

We have to give support to the conclusion.

Let's look at A : No practical means currently exist to raise revenues.

There are two issues, I think - First the statement talks about practical means. It doesn't tell there are no means, but tells that the means are not practical. Second is the use of the word currently. If something doesn't exists currently doesn't mean it can't exist in future ( we are talking about few years, and not immediate).

Let's look at D : The government is against increasing the tax burden on its citizens

Say if the government were to increase taxes, then the deficit would go down. We already know that the spendings have been curbed to whatever extent possible, so one of the two factors have been taken care of.

This option rules out any alternate possibility.

Hence this statement lends support.

IMO D

I would like to address one last point in your method of reasoning -

Braintree wrote:
What if the government can raise revenues through exports to other countries? In that case the tax burden would not be on it’s own citizens.

If the revenues are raised through other means the conclusion falls apart. It means the deficit will reduce (as the spendings are already curbed to the lowest possible). Hence we can't assume something that defies the conclusion as we need to support the same.

Would like to hear your thoughts

Interesting counterpoint, gmatophobia. Thanks

First, regarding:

Braintree wrote:
What if the government can raise revenues through exports to other countries? In that case the tax burden would not be on it’s own citizens.

What I mean here is raising revenues through taxing citizens of other countries through domestic exports (customs) or through say Foreign direct investments etc. (a lot of the taxes that the government receives are not from its own citizens). The premises, just talks about 'taxes' and not 'taxes from its own citizens', whereas Answer choice D specifically talks about taxes from its citizens. Note that the word 'burden' in Answer choice D is also limiting - since the burden of taxes shift all the time (that is why the word "INDIRECT" in 'indirect taxes' - because they shift the burden to someone else - in this case, say a non-citizen.)

Getting that out of the way, now lets focus on whether A or whether D is more airtight:

I do agree that 'currently' in statement A is vague. (I wouldn't take too much stock in the word "Practical", since what is "impractical", by definition cannot be practiced or implemented).

So given that both these statements keep loopholes open, we may have to consider their respective degree of 'airtightness' . In such a case, I prefer Statement A over Statement D, since given the following chain of logic:

Increased Taxes -> Increased Revenues.

Statement A directly addresses the end link of the chain of logic, and therefore avoids any other possible seepages.

Cheers,
bt
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Re: The deficit is the difference between the amount that the government [#permalink]
gmatophobia wrote:
Braintree wrote:
The deficit is the difference between the amount that the government taxes in as revenue and the amount that it spends in a given year. There are only two ways to cut the deficit: raise revenue or cut spending. The current government has carried out all possible efforts to cut spending without any significant effect on the deficit. It then follows that the deficit will remain at the current level for a few years since _________________

Which of the following best completes the passage?

A. No practical means currently exist to raise revenues.

B. The economy is stagnant and does not allow for any more industrial spending.

C. The government has to comply to international limits placed on its export contacts

D. The government is against increasing the tax burden on its citizens

E. The government is currently focusing on internal revenue management

Note that A is more airtight than D. The key sentence is “ There are only two ways to cut the deficit: raise revenue or cut spending”. Answer choice A directly addresses that there is no way to raise Revenues. Answer choice D on the other hand keeps a few backdoors open - such as the restricting word ‘citizens’. What if the government can raise revenues through exports to other countries? In that case the tax burden would not be on it’s own citizens.

bt

I have a different opinion on this

Let's see the conclusion of the argument.

Conclusion : The deficit will remain at the current level for a few years

We have to give support to the conclusion.

Let's look at A : No practical means currently exist to raise revenues.

There are two issues, I think - First the statement talks about practical means. It doesn't tell there are no means, but tells that the means are not practical. Second is the use of the word currently. If something doesn't exists currently doesn't mean it can't exist in future ( we are talking about few years, and not immediate).

Let's look at D : The government is against increasing the tax burden on its citizens

Say if the government were to increase taxes, then the deficit would go down. We already know that the spendings have been curbed to whatever extent possible, so one of the two factors have been taken care of.

This option rules out any alternate possibility.

Hence this statement lends support.

IMO D

I would like to address one last point in your method of reasoning -

Braintree wrote:
What if the government can raise revenues through exports to other countries? In that case the tax burden would not be on it’s own citizens.

If the revenues are raised through other means the conclusion falls apart. It means the deficit will reduce (as the spendings are already curbed to the lowest possible). Hence we can't assume something that defies the conclusion as we need to support the same.

Would like to hear your thoughts

Posted from my mobile device
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Re: The deficit is the difference between the amount that the government [#permalink]
[/quote]

I followed same thought process.

Our conclusion is : The deficit will remain at the current level for a few years
Premise is : - All possible efforts to cut spending is done

Option D The government is against increasing the tax burden on its citizens : Dosen't give answer to if increased tax would have imposed on citizen , would it have sufficient to reduce deficit ?...We don't know....Also increasing tax burden IS means of Increasing Revenue ...comes with out of knowledge,Which generally in GMAT exam don't have to apply....so we should be more rely on Premise already given

So, A will be best choice.

Lets wait for official OA revelation[/quote]

Tbh, I’d not lose much sleep over this. Do non-official questions for practice, but develop your concepts and ‘takeaways’ only from official questions. Or if you really need to, then non-official questions which are vetted by reputed experts (replied).

Posted from my mobile device
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Re: The deficit is the difference between the amount that the government [#permalink]
Tbh, I’d not lose much sleep over this. Do non-official questions for practice, but develop your concepts and ‘takeaways’ only from official questions. Or if you really need to, then develop concepts from non-official questions that are vetted by (replied by) reputed experts.

Posted from my mobile device[/quote]

Originally posted by Braintree on 12 Nov 2022, 03:06.
Last edited by Braintree on 12 Nov 2022, 11:48, edited 1 time in total.
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Re: The deficit is the difference between the amount that the government [#permalink]
Isn't A is extreme? the first line of the argument states that the government taxes in as revenue

There are no ways or only......- most of the time these express extreme cases
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Re: The deficit is the difference between the amount that the government [#permalink]
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winterschool wrote:
Isn't A is extreme? the first line of the argument states that the government taxes in as revenue

There are no ways or only......- most of the time these express extreme cases

It's risky to rely on such heuristics to solve CR questions (or any GMAT question, for that matter).

In this case, for example, we are looking for a statement that eliminates the possibility that the government can increase its revenues. Thus, the more 'extreme' that an answer choice is to eliminate this possibility, the better it is. Rather, the whole discussion above is that Answer choices A and D are not as extreme as are needed - that they don't go all the way to eliminate the possibility that the government CAN increase its revenues (because of the word 'current', for example, in Answer Choice A, and the word 'citizens' in Answer Choice D).

bt
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Re: The deficit is the difference between the amount that the government [#permalink]
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kapil1995 wrote:
kapil1995 wrote:
Premise 1 : Only 2 ways to reduce deficit RAISE REVENUE Or CUT SPENDING
Premise 2 : The current government has carried out all possible efforts to cut spending But deficit will remain at the current level

This clearly shows that there might not be possible way to increase revnue

A. No practical means currently exist to raise revenues.

Yeah ,Got the answer .Option A

KarishmaB daagh

Still think answer should be Option A than Option D .

We are concluding about the next few years.

A. No practical means currently exist to raise revenues.

Option (A) talks about the current situation. It needed to add '... and any new method takes a few years to become practical' or something like that. We can't give an outlook for a few years based on option (A) as given originally.

D. The government is against increasing the tax burden on its citizens

The Govt could increase tax on foreign set ups in the country or on residents who are not citizens yet etc. Also we don't know how long the current Govt will be in power. If elections are to be help later this year, we may not be able to say what will happen in a few years. Also, even if the Govt is against increasing tax burden today, after some days it may change its mind due to some political pressures. Hence, giving an outlook for a few years based on option (D) is not very meaningful.
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Re: The deficit is the difference between the amount that the government [#permalink]
The deficit is the difference between the amount that the government taxes in as revenue and the amount that it spends in a given year. There are only two ways to cut the deficit: raise revenue or cut spending. The current government has carried out all possible efforts to cut spending without any significant effect on the deficit. It then follows that the deficit will remain at the current level for a few years since _________________

Which of the following best completes the passage?

A. No practical means currently exist to raise revenues.

B. The economy is stagnant and does not allow for any more industrial spending.

C. The government has to comply to international limits placed on its export contacts

D. The government is against increasing the tax burden on its citizens

E. The government is currently focusing on internal revenue management

Between A & D. I believe A is a better option.
The deficit will remain at current levels for a few years...because currently there are no practical means to adjust revenues. Even if there are any other theoretical means or anything of such sort, they are useless unless they can be put into practice. Hence this is an objective assumption.
Also, the word "Currently" ties the scope to future as well...by implicitly stating that the current situation may change in this future.

Also, Option D is a bit subjective assumption which cannot be readily assumed especially when you already have an objective assumption.
Re: The deficit is the difference between the amount that the government [#permalink]
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