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20 Jun 2018, 05:19
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Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
15%
(low)
Question Stats:
82% (01:41) correct
18%
(02:02)
wrong
based on 5232
sessions
History
Date
Time
Result
Not Attempted Yet
More and more law firms specializing in corporate taxes are paid on a contingency-fee basis. Under this arrangement, if a case is won, the firm usually receives more than it would have received if it had been paid on the alternate hourly rate basis. If the case is lost, the firm receives nothing. Most firms are likely to make more under the contingency-fee arrangement.
Which of the following, if true, would most strengthen the prediction above?
(A) Firms that work exclusively under the hourly rate arrangement spend, on average, fewer hours on cases that are won than on cases that are lost.
(B) Some litigation can last for years before any decision is reached, and, even then, the decision may be appealed.
(C) Firms under the contingency-fee arrangement still pay their employees on an hourly basis.
(D) Since the majority of firms specialize in certain kinds of cases, they are able to assess accurately their chances of winning each potential case.
(E) Firms working under the contingency-fee arrangement take in fewer cases per year than do firms working under the hourly rate arrangement.
(CR01102)
Which of the following, if true, would most strengthen the prediction above?
(A) Firms that work exclusively under the hourly rate arrangement spend, on average, fewer hours on cases that are won than on cases that are lost.
(B) Some litigation can last for years before any decision is reached, and, even then, the decision may be appealed.
(C) Firms under the contingency-fee arrangement still pay their employees on an hourly basis.
(D) Since the majority of firms specialize in certain kinds of cases, they are able to assess accurately their chances of winning each potential case.
(E) Firms working under the contingency-fee arrangement take in fewer cases per year than do firms working under the hourly rate arrangement.
(CR01102)
Step 1: Identify the Question
The word strengthen in the question stem indicates that this is a Strengthen the Argument question.
Step 2: Deconstruct the Argument
Cont. fee: firm wins case → more $ than hourly
Lose case → no $
© most firms Cont. fee $ > hourly $
The argument describes the way in which a law firm’s earnings are determined under a contingency-fee arrangement. (The alternative arrangement is an hourly rate.) If the firm wins the case, it earns more money than it otherwise would; if it loses, it earns nothing. The author concludes that most firms will make more money under this arrangement. Note that this relies on an assumption: that the extra money the firms make by winning cases will outweigh the potential money they lose by losing cases.
Step 3: Pause and State the Goal
On Strengthen the Argument questions, the right answer will make the conclusion more likely to be correct. In this case, the right answer will suggest that law firms will, in fact, earn more money by charging a contingency fee.
Step 4: Work from Wrong to Right
(A) This answer choice compares two scenarios under the hourly rate arrangement. However, it does not provide any information about what happens under the contingency fee arrangement. The right answer must suggest that earnings will be higher under the contingency fee arrangement, so it needs to provide some information about what happens under this arrangement as well.
(B) This answer choice does not give any information about law firms’ earnings, regardless of the fee arrangement. Litigation lasting for years might result in either a win or a loss, and might result in a higher or lower fee for the firm, regardless of fee structure.
(C) This answer choice explains the way that employees are paid. However, the argument is concerned with how much the firms earn, so their costs do not affect the argument.
(D) CORRECT. The argument assumes that the firms will gain more by winning cases than they will lose by losing cases. This answer choice suggests that the assumption is correct: since firms can tell which cases they’re likely to win, they can choose to only take those cases, which makes it very likely that their earnings will outweigh their losses.
(E) This statement only affects the conclusion if certain outside assumptions are made. If firms with fewer cases make less money, the answer choice suggests that switching to a contingency fee might reduce earnings. However, this is the opposite of what the right answer should do. Also, the right answer will never require additional assumptions to affect the conclusion.
The word strengthen in the question stem indicates that this is a Strengthen the Argument question.
Step 2: Deconstruct the Argument
Cont. fee: firm wins case → more $ than hourly
Lose case → no $
© most firms Cont. fee $ > hourly $
The argument describes the way in which a law firm’s earnings are determined under a contingency-fee arrangement. (The alternative arrangement is an hourly rate.) If the firm wins the case, it earns more money than it otherwise would; if it loses, it earns nothing. The author concludes that most firms will make more money under this arrangement. Note that this relies on an assumption: that the extra money the firms make by winning cases will outweigh the potential money they lose by losing cases.
Step 3: Pause and State the Goal
On Strengthen the Argument questions, the right answer will make the conclusion more likely to be correct. In this case, the right answer will suggest that law firms will, in fact, earn more money by charging a contingency fee.
Step 4: Work from Wrong to Right
(A) This answer choice compares two scenarios under the hourly rate arrangement. However, it does not provide any information about what happens under the contingency fee arrangement. The right answer must suggest that earnings will be higher under the contingency fee arrangement, so it needs to provide some information about what happens under this arrangement as well.
(B) This answer choice does not give any information about law firms’ earnings, regardless of the fee arrangement. Litigation lasting for years might result in either a win or a loss, and might result in a higher or lower fee for the firm, regardless of fee structure.
(C) This answer choice explains the way that employees are paid. However, the argument is concerned with how much the firms earn, so their costs do not affect the argument.
(D) CORRECT. The argument assumes that the firms will gain more by winning cases than they will lose by losing cases. This answer choice suggests that the assumption is correct: since firms can tell which cases they’re likely to win, they can choose to only take those cases, which makes it very likely that their earnings will outweigh their losses.
(E) This statement only affects the conclusion if certain outside assumptions are made. If firms with fewer cases make less money, the answer choice suggests that switching to a contingency fee might reduce earnings. However, this is the opposite of what the right answer should do. Also, the right answer will never require additional assumptions to affect the conclusion.
21 Jun 2018, 01:27
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Bunuel
Question Type: Strengthen
Premise: More and more law firms are paid on a contingency-fee basis rather than hourly rate basis. If a case is won, the firm receives higher compensation than hourly rate basis & if the case is lost, they get nothing.
Conclusion: Most firms are likely to make more under the contingency-fee arrangement.
Analysis: The tone of the argument, is very generalized, as is evident from the usage of "More & More" & "Most", hence a correct answer will also be on the same lines. A strengthener, should either show that the firms, which use the contingency fee arrangement, to avert the risk of loosing, are certain of winning & have done due diligence to avoid loss, before accepting a case. A strengthener could also show that hourly rate makes less money for the firms than contingency fee arrangement.
A. Firms that work exclusively under the hourly rate arrangement spend, on average, fewer hours on cases that are won than on cases that are lost. Incorrect. Weakens the argument, as cases lost still make more money than cases won, due to hourly rate.
B. Some litigation can last for years before any decision is reached, and, even then, the decision may be appealed. Incorrect. Hourly rate will make more money for the firm.
C. Firms under the contingency-fee arrangement still pay their employees on an hourly basis. Incorrect. Out of scope.
D. Since the majority of firms specialize in certain kinds of cases, they are able to assess accurately their chances of winning each potential case. Correct. As per analysis, that firms do due diligence before accepting a case. The tone is generalized just as the argument.
E. Firms working under the contingency-fee arrangement take in fewer cases per year than do firms working under the hourly rate arrangement. Incorrect. Irrelevant
Answer D.
Thanks,
GyM
06 Jul 2018, 11:07
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More and more law firms specializing in corporate taxes are paid on a contingency-fee basis. Under this arrangement, if a case is won, the firm usually receives more than it would have received if it had been paid on the alternate hourly rate basis. If the case is lost, the firm receives nothing. Most firms are likely to make more under the contingency-fee arrangement.
Which of the following, if true, would most strengthen the prediction above?
A. Firms that work exclusively under the hourly rate arrangement spend, on average, fewer hours on cases that are won than on cases that are lost.
B. Some litigation can last for years before any decision is reached, and, even then, the decision may be appealed.
C. Firms under the contingency-fee arrangement still pay their employees on an hourly basis.
D. Since the majority of firms specialize in certain kinds of cases, they are able to assess accurately their chances of winning each potential case.
E. Firms working under the contingency-fee arrangement take in fewer cases per year than do firms working under the hourly rate arrangement.
Question Type: Strengthen
BID (Boil It Down): Contingent = Bigger payout if won; Nothing if lost -> Firms make more with Contingent
Conclusion: Most firms make more money under the contingency fee arrangement using an hourly rate basis.
Evidence: All we are told is that firms usually make more money if they win a case under the contingency arrangement if they win, but make nothing if they lose.
Missing Information (Assumption): The gain from the additional payout if won is enough to compensate for the cases lost for most firms.
Goal: Find the option that helps prove that the gain from the additional payout if won is enough to compensate for the cases lost for most firms.
Choice D is correct. This tells us that firms can be choosy, selecting only those cases that they are likely to win. This way they won’t suffer too many losses, which helps reinforce the assumption that the added gains will help make up for the loss in revenue for lost cases. Otherwise, if they DID suffer many losses, then the hourly rate basis would make more sense.
Choice A makes an irrelevant comparison. Option A does not address the contingency arrangement and a comparison in hours spent isn’t clear to the logic of the argument.
Choice B states that “some” cases can last years, but, if anything, this supports choosing the hourly rate basis, so this option is a 180 in that regard.
Choice C is irrelevant. This option has no impact on the conclusion. The information in the prompt suggests if workers are paid hourly in contingency arrangements doing so wouldn’t impede firms’ ability to generate outsized pay.
Choice E is an irrelevant comparison. A comparison of the number of cases handled by the two types of firms does not support the idea that one arrangement is more profitable than the other. Thus this option neither strengthens nor weakens the argument.
Which of the following, if true, would most strengthen the prediction above?
A. Firms that work exclusively under the hourly rate arrangement spend, on average, fewer hours on cases that are won than on cases that are lost.
B. Some litigation can last for years before any decision is reached, and, even then, the decision may be appealed.
C. Firms under the contingency-fee arrangement still pay their employees on an hourly basis.
D. Since the majority of firms specialize in certain kinds of cases, they are able to assess accurately their chances of winning each potential case.
E. Firms working under the contingency-fee arrangement take in fewer cases per year than do firms working under the hourly rate arrangement.
Question Type: Strengthen
BID (Boil It Down): Contingent = Bigger payout if won; Nothing if lost -> Firms make more with Contingent
Conclusion: Most firms make more money under the contingency fee arrangement using an hourly rate basis.
Evidence: All we are told is that firms usually make more money if they win a case under the contingency arrangement if they win, but make nothing if they lose.
Missing Information (Assumption): The gain from the additional payout if won is enough to compensate for the cases lost for most firms.
Goal: Find the option that helps prove that the gain from the additional payout if won is enough to compensate for the cases lost for most firms.
Choice D is correct. This tells us that firms can be choosy, selecting only those cases that they are likely to win. This way they won’t suffer too many losses, which helps reinforce the assumption that the added gains will help make up for the loss in revenue for lost cases. Otherwise, if they DID suffer many losses, then the hourly rate basis would make more sense.
Choice A makes an irrelevant comparison. Option A does not address the contingency arrangement and a comparison in hours spent isn’t clear to the logic of the argument.
Choice B states that “some” cases can last years, but, if anything, this supports choosing the hourly rate basis, so this option is a 180 in that regard.
Choice C is irrelevant. This option has no impact on the conclusion. The information in the prompt suggests if workers are paid hourly in contingency arrangements doing so wouldn’t impede firms’ ability to generate outsized pay.
Choice E is an irrelevant comparison. A comparison of the number of cases handled by the two types of firms does not support the idea that one arrangement is more profitable than the other. Thus this option neither strengthens nor weakens the argument.
