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Two years ago, after witnessing several consecutive years of excessive

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Manager
Joined: 16 May 2016
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Location: India
Concentration: Marketing, Healthcare
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Two years ago, after witnessing several consecutive years of excessive  [#permalink]

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02 Aug 2018, 03:44
00:00

Difficulty:

25% (medium)

Question Stats:

83% (01:22) correct 17% (01:39) wrong based on 66 sessions

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Two years ago, after witnessing several consecutive years of excessive rent increases in the city and continual protests about the same, the city of Raylayer decided to fix an upper limit on these increases. Since then the landlords have not been able to increase the rent amounts substantially, but on an average the total amount people have been spending to rent similar accommodation has increased at a rate much higher than the increase in the rents.

Which of the following, it true, most helps to explain why the rent cap did not achieve its goal?

A. The demand for independent houses, houses that are typically rented at a much higher rate than apartments in a multi-storeyed buildings, has not gone down in the past two years.

B. Landlords have the liberty to hike maintenance charges, charges not limited by the ceiling on the rent.

C. Seven years ago, a similar rent ceiling program was implemented in Raylayer, but it was subsequently cancelled because of the frequent protests by different associations that protect the interest of landlords in Raylayer.

D. Raylayer is one of the most expensive cities to live in the country.

E. The overall demand for rented accommodation in Raylayer has been at an all-time low since many people decided to move to nearby cities two years ago when the city faced excessive hikes in rents.

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Two years ago, after witnessing several consecutive years of excessive  [#permalink]

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02 Aug 2018, 04:41
Prethinking : The city has set an upper limit on the rent increases. Since then the landlords have not been able to increase the rent amounts substantially. Since the landlords cannot increase the rent, they might have increase other charges associated with the rent such as maintenance charge, parking charge etc which might have increased the average amount of renting the houses.

A. The demand for independent houses, houses that are typically rented at a much higher rate than apartments in a multi-storeyed buildings, has not gone down in the past two years.

This option talks specifically about the independent houses and doesn't explain why the rent has not succeeded in achieving its goal. We also don't know how many independent houses are there in the city. INCORRECT

B. Landlords have the liberty to hike maintenance charges, charges not limited by the ceiling on the rent.

This option explains the reason why the average amount to rent houses in the city has not decreases. Since the landlords cannot increase the rent as there is a rent cap, they increased the rent associated charges which explain why the rent cap was not successful.

C. Seven years ago, a similar rent ceiling program was implemented in Raylayer, but it was subsequently cancelled because of the frequent protests by different associations that protect the interest of landlords in Raylayer.

This option provides information about a past rent cap plan and has nothing to do with current plan or why the current plan failed. INCORRECT

D. Raylayer is one of the most expensive cities to live in the country.

Irrelevant information and doesn't explain why the rent cap has failed to control the increasing rental charges in the city. INCORRECT

E. The overall demand for rented accommodation in Raylayer has been at an all-time low since many people decided to move to nearby cities two years ago when the city faced excessive hikes in rents.

This goes against why the rent cap system has failed. If this option was true, the rent cap plan should've been successful in limiting the charges. INCORRECT

Hence option B
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Re: Two years ago, after witnessing several consecutive years of excessive  [#permalink]

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07 Aug 2018, 08:25
Cbirole wrote:
Two years ago, after witnessing several consecutive years of excessive rent increases in the city and continual protests about the same, the city of Raylayer decided to fix an upper limit on these increases. Since then the landlords have not been able to increase the rent amounts substantially, but on an average the total amount people have been spending to rent similar accommodation has increased at a rate much higher than the increase in the rents.

Which of the following, it true, most helps to explain why the rent cap did not achieve its goal?

A. The demand for independent houses, houses that are typically rented at a much higher rate than apartments in a multi-storeyed buildings, has not gone down in the past two years.

B. Landlords have the liberty to hike maintenance charges, charges not limited by the ceiling on the rent.

C. Seven years ago, a similar rent ceiling program was implemented in Raylayer, but it was subsequently cancelled because of the frequent protests by different associations that protect the interest of landlords in Raylayer.

D. Raylayer is one of the most expensive cities to live in the country.

E. The overall demand for rented accommodation in Raylayer has been at an all-time low since many people decided to move to nearby cities two years ago when the city faced excessive hikes in rents.

little prethinking with experience of staying in rented accomodation solves easily.
Re: Two years ago, after witnessing several consecutive years of excessive &nbs [#permalink] 07 Aug 2018, 08:25
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