The people of Prohibitionland are considering banning the : GMAT Critical Reasoning (CR)
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# The people of Prohibitionland are considering banning the

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The people of Prohibitionland are considering banning the [#permalink]

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09 Dec 2007, 16:27
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The people of Prohibitionland are considering banning the service of alcoholic beverages in restaurants to curb unruly behavior on the part of its residents. Proprietors of restaurants in Prohibitionland are protesting the ban on the grounds that it will reduce their revenues and profits. However, several provinces in Prohibitionland enacted restrictions on alcoholic beverages last year, and the sales taxes paid by the restaurants in those provinces rose by an average of 50 percent. In contrast, the sales taxes paid by restaurants located in areas of Prohibitionland that did not have any restrictions rose by an average of 30 percent.

Which of the following, if true, supports the restaurant proprietors’ economic stance against the ban?

In the provinces that restricted alcoholic beverages, there was a short-term negative impact on restaurant visitation in the beginning of last year.

The sales tax in Prohibitionland is lower on food and beverages than it is on other consumer goods, such as clothing.

The consumption of alcoholic beverages in Prohibitionland has been on a gradual decline the last 20 years.

The restrictions on alcoholic beverages enacted last year allowed for the service of drinks beginning around dinnertime each evening.

Overall sales tax revenue did not increase at a substantially higher rate in the provinces that enacted the restrictions on alcoholic beverages than in the rest of Prohibitionland last year.
[Reveal] Spoiler: OA

Last edited by Zarrolou on 05 Jun 2013, 12:47, edited 1 time in total.
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10 Dec 2007, 10:17
D. The restrictions on alcoholic beverages enacted last year allowed for the service of drinks beginning around dinnertime each evening.

They're trying to ban alcohol by showing positive growth figures from an area where restrictions didn't ban alcohol at all. Argument doesn't make sense.
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23 Feb 2008, 14:53
A ?
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23 Feb 2008, 15:20
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Conclusion: The impact of prohibition on the economy

In the provinces that restricted alcoholic beverages, there was a short-term negative impact on restaurant visitation in the beginning of last year. [This weakens the conclusion – eliminate it]

The sales tax in Prohibitionland is lower on food and beverages than it is on other consumer goods, such as clothing. [Sales tax comparison does not support the conclusion – eliminate it]

The consumption of alcoholic beverages in Prohibitionland has been on a gradual decline the last 20 years. [Alcohol sales pattern last 20 years has no effect on the conclusion – eliminate]

The restrictions on alcoholic beverages enacted last year allowed for the service of drinks beginning around dinnertime each evening. [Effective time of prohibition is out scope – eliminate it]

Overall sales tax revenue did not increase at a substantially higher rate in the provinces that enacted the restrictions on alcoholic beverages than in the rest of Prohibitionland last year. [Hold it]

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23 Feb 2008, 15:55
A for me.

Whats the OA?
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24 Feb 2008, 12:07
Im for E.

A is only shortterm. What if in the longterm there are positive results? Dunno, this isnt enough in my opinion.
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24 Feb 2008, 20:37

NOT E because it says that the over all revenues didnt increase at a substantial rates, but we are least bothered about overall revenues.
IT is clear from the passage that the revenues rose by 50% in the province which have restrictions.
we just need to attack this point becoz we can prove that the same rise wouldnt be seen in our case, that wud be the solution.
and D fits the bill perfectly.
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26 Feb 2008, 00:00
E. What is OA
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Neelabh Mahesh

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26 Feb 2008, 07:56
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11 Mar 2008, 01:47
E for me. The question asks for an "Economic Stance" and E fits the bill perfectly. A is also likely but unfortunately it is only short term.

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11 Mar 2008, 11:16
Large percentages doesn't mean large amounts and reverse is also true. E is correct.
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11 Mar 2008, 11:27
The restrictions on alcoholic beverages enacted last year allowed for the service of drinks beginning around dinnertime each evening. I agree with D since it provides the reason for why sales taxes increased for restaurants in restricted areas. What's the OA?
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11 Mar 2008, 23:41
ocprep wrote:
The restrictions on alcoholic beverages enacted last year allowed for the service of drinks beginning around dinnertime each evening. I agree with D since it provides the reason for why sales taxes increased for restaurants in restricted areas. What's the OA?

The question asked is restaurant proprietors’ economic stance against the ban?
We have to justify the restaurant proprietors’ stand against the ban and not prove that sales taxes increased for restaurants in restricted areas.

Keeping the question in mind ,IMo is A..

Any takers.
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12 Mar 2008, 07:58
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dynamo wrote:
ocprep wrote:
The restrictions on alcoholic beverages enacted last year allowed for the service of drinks beginning around dinnertime each evening. I agree with D since it provides the reason for why sales taxes increased for restaurants in restricted areas. What's the OA?

The question asked is restaurant proprietors’ economic stance against the ban?
We have to justify the restaurant proprietors’ stand against the ban and not prove that sales taxes increased for restaurants in restricted areas.

Keeping the question in mind ,IMo is A..

Any takers.

Well here's my reasoning...IMO choice D supports their economic stance and taxes do play into it...
1) Proprietors of restaurants in Prohibitionland are protesting the ban on the grounds that it will reduce their revenues and profits.
2) But several provinces in Prohibitionland enacted restrictions the sales taxes paid by the restaurants in those provinces rose by an average of 50 percent. In contrast, the sales taxes paid by restaurants that did not have any restrictions went up only 30 percent. In essence, the proponents of the ban are saying that sales tax increased for restaurants that had restrictions therefore sales did not decrease.
3) But D, explains why sales tax (income) increased even with the restriction for those restuarants because they still sold alcohol.

Your choice A says there was a short term negative impact and that really doesn't support the cause. What's the OA?
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12 Mar 2008, 13:21
I vote E. All others were eliminated.
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12 Mar 2008, 13:26
I am somewhat confused at the term "tax revenues". Does that mean revenues to the regulators, or revenues to the restaurants? I am viewing it as a tax revenue to the regulators, which then rules out D.
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01 Oct 2008, 21:29
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Quote:
The people of Prohibitionland are considering banning the service of alcoholic beverages in restaurants to curb unruly behavior on the part of its residents. Proprietors of restaurants in Prohibitionland are protesting the ban on the grounds that it will reduce their revenues and profits. However, several provinces in Prohibitionland enacted restrictions on alcoholic beverages last year, and the sales taxes paid by the restaurants in those provinces rose by an average of 50 percent. In contrast, the sales taxes paid by restaurants located in areas of Prohibitionland that did not have any restrictions rose by an average of 30 percent.

Which of the following, if true, supports the restaurant proprietors' economic stance against the ban?

A. In the provinces that restricted alcoholic beverages, there was a short-term negative impact on restaurant visitation in the beginning of last year.

B. The sales tax in Prohibitionland is lower on food and beverages than it is on other consumer goods, such as clothing.

C. The consumption of alcoholic beverages in Prohibitionland has been on a gradual decline the last 20 years.

D. The restrictions on alcoholic beverages enacted last year allowed for the service of drinks beginning around dinnertime each evening.

E. Overall sales tax revenue did not increase at a substantially higher rate in the provinces that enacted the restrictions on alcoholic beverages than in the rest of Prohibitionland last year.

Extracting info from the passage:

-----
People: lets ban alcohol in bars
Bar owners: No, will reduce our revenues!
People use example to support their claim: restrictions were implemented in some provinces -> revenues up!

Support bar owners claim.
----

How to support owners? Fight the evidence (the People’s example) used!

Couple things I note while reading the passage:
1. People propose a “ban” but use "restrictions" in their example. Do the terms mean the same thing?
2. Even with restrictions bar’s revenues increased!

The only question in my mind by now is does “restrictions”=”full restrictions” i.e. ban?

Because if restrictions are “full” (i.e. no alcohol is sold) but revenues increased than Bar Owners have nothing to worry about should ok the ban and expect revenue growth. However, if restrictions are *partial* (say only 2 hours/day alcohol sale is permitted) then the evidence People use to support their claim (2 hrs/day alcohol sales but revenues show increase) will definitely show that alcohol sales make $$and by implementing the ban this dollar stream will be gone! Now, D tells us that alcohol was sold couple hours per day i.e. the restrictions do not equal to ban! Manager Joined: 27 Aug 2008 Posts: 150 Followers: 0 Kudos [?]: 45 [0], given: 0 Re: CR - Prohibitionland [#permalink] ### Show Tags 01 Oct 2008, 22:08 snaps wrote: Quote: The people of Prohibitionland are considering banning the service of alcoholic beverages in restaurants to curb unruly behavior on the part of its residents. Proprietors of restaurants in Prohibitionland are protesting the ban on the grounds that it will reduce their revenues and profits. However, several provinces in Prohibitionland enacted restrictions on alcoholic beverages last year, and the sales taxes paid by the restaurants in those provinces rose by an average of 50 percent. In contrast, the sales taxes paid by restaurants located in areas of Prohibitionland that did not have any restrictions rose by an average of 30 percent. Which of the following, if true, supports the restaurant proprietors' economic stance against the ban? A. In the provinces that restricted alcoholic beverages, there was a short-term negative impact on restaurant visitation in the beginning of last year. B. The sales tax in Prohibitionland is lower on food and beverages than it is on other consumer goods, such as clothing. C. The consumption of alcoholic beverages in Prohibitionland has been on a gradual decline the last 20 years. D. The restrictions on alcoholic beverages enacted last year allowed for the service of drinks beginning around dinnertime each evening. E. Overall sales tax revenue did not increase at a substantially higher rate in the provinces that enacted the restrictions on alcoholic beverages than in the rest of Prohibitionland last year. Extracting info from the passage: ----- People: lets ban alcohol in bars Bar owners: No, will reduce our revenues! People use example to support their claim: restrictions were implemented in some provinces -> revenues up! Support bar owners claim. ---- How to support owners? Fight the evidence (the People’s example) used! Couple things I note while reading the passage: 1. People propose a “ban” but use "restrictions" in their example. Do the terms mean the same thing? 2. Even with restrictions bar’s revenues increased! The only question in my mind by now is does “restrictions”=”full restrictions” i.e. ban? Because if restrictions are “full” (i.e. no alcohol is sold) but revenues increased than Bar Owners have nothing to worry about should ok the ban and expect revenue growth. However, if restrictions are *partial* (say only 2 hours/day alcohol sale is permitted) then the evidence People use to support their claim (2 hrs/day alcohol sales but revenues show increase) will definitely show that alcohol sales make$$\$ and by implementing the ban this dollar stream will be gone!

Now, D tells us that alcohol was sold couple hours per day i.e. the restrictions do not equal to ban!

You've raised the sales tax by 50% in provinces where there is ban & still the revenues from the tax have not risen. This clearly implies that your sales have fallen. This is what the owners had been cribbing about.

Man you are still discussing even after 1 year!!! When do you plan to post the OA.
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02 Oct 2008, 00:32
applecrisp wrote:
The people of Prohibitionland are considering banning the service of alcoholic beverages in restaurants to curb unruly behavior on the part of its residents. Proprietors of restaurants in Prohibitionland are protesting the ban on the grounds that it will reduce their revenues and profits. However, several provinces in Prohibitionland enacted restrictions on alcoholic beverages last year, and the sales taxes paid by the restaurants in those provinces rose by an average of 50 percent. In contrast, the sales taxes paid by restaurants located in areas of Prohibitionland that did not have any restrictions rose by an average of 30 percent.

Which of the following, if true, supports the restaurant proprietors’ economic stance against the ban?

In the provinces that restricted alcoholic beverages, there was a short-term negative impact on restaurant visitation in the beginning of last year. -> this weakens their stance since it says the impact is only short lived

The sales tax in Prohibitionland is lower on food and beverages than it is on other consumer goods, such as clothing.
-> this is OOS
The consumption of alcoholic beverages in Prohibitionland has been on a gradual decline the last 20 years.
-> does not help ,again we need to concentrate on economic impact of the ban
The restrictions on alcoholic beverages enacted last year allowed for the service of drinks beginning around dinnertime each evening.
-> this is wrong ,this ion turn speaks against the proprietors stance ,since inspite of \restriction they are allowed to sell

Overall sales tax revenue did not increase at a substantially higher rate in the provinces that enacted the restrictions on alcoholic beverages than in the rest of Prohibition land last year. -> this is best in the lot ,this says overall sales tax revenue does not increase ,hence post restriction the sales went down and tereby taxes went down,hence no one benefitted ,hence justifies

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02 Oct 2008, 06:42
IMO D.

E is something that is against the given primises that tax increase 30% vs 50% where there was a Ban.
Re: CR - Prohibitionland   [#permalink] 02 Oct 2008, 06:42

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