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E
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Difficulty:
95%
(hard)
Question Stats:
44% (02:23) correct
56%
(02:25)
wrong
based on 623
sessions
History
Date
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Result
Not Attempted Yet
In the year following an eight-cent increase in the federal tax on a pack of cigarettes, sales of cigarettes fell ten percent. In contrast, in the year prior to the tax increase, sales had fallen one percent. The volume of cigarette sales is therefore strongly related to the after-tax price of a pack of cigarettes.
Which of the following, if true, provides the evidence that contradicts the hypothesis above?
A. During the year following the tax increase, the pretax price of a pack of cigarettes did not increase by as much as it had during the year prior to the tax increase.
B. The one percent fall in cigarette sales in the year prior to tax increase was due to a smaller tax increase.
C. The pretax price of a pack of cigarettes gradually decreased throughout the year before and the year after the tax increase.
D. For the year following the tax increase, the pretax price of a pack of cigarettes was not eight or more cents lower than it had been the previous year.
E. Economic growth boosts employment rate and thus alleviates the number of smokers.In the year following the tax increase the country observed a tremendous boost in the economy.
Which of the following, if true, provides the evidence that contradicts the hypothesis above?
A. During the year following the tax increase, the pretax price of a pack of cigarettes did not increase by as much as it had during the year prior to the tax increase.
B. The one percent fall in cigarette sales in the year prior to tax increase was due to a smaller tax increase.
C. The pretax price of a pack of cigarettes gradually decreased throughout the year before and the year after the tax increase.
D. For the year following the tax increase, the pretax price of a pack of cigarettes was not eight or more cents lower than it had been the previous year.
E. Economic growth boosts employment rate and thus alleviates the number of smokers.In the year following the tax increase the country observed a tremendous boost in the economy.
22 Jun 2017, 01:49
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nailin16
Main conclusion : Tax increase affects cigarettes sales.
We have to undermine this conclusion.
A)Comparison should have been between pretax prices before both the instances of tax increases, and not just before and after the last tax increase.
B) This option strengthens the conclusion , by saying that indeed this time the higher tax caused the decrease in sales.
C) This option also indirectly blames the tax increase.
D) Also says that tax increase did indeed cause the price of cigarettes to increase. IF after eight cents tax had been increased the pretax price of cigarettes did become eight or more cents lower , then the total price of a pack of cigarettes could not have increased or might even have decreased.
E) Correct: Undermines the conclusion, says there is another reason for the decline in sales of cigarettes.
alleviates means reduces, hence growth in economy is responsible for the sales decrease and not necessarily the tax increase.
IMO E
Kindly share the OA.
06 Aug 2019, 07:12
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It's hard to evaluate E because it's not using words correctly (you can't "alleviate the number of smokers"; that's not using "alleviate" correctly). Of course if we have an explanation for a decline in smoking besides price, that contradicts the hypothesis, so if that's what answer E is trying to say, it's a good answer.
But C is also a good answer. The stem points out that the tax alone increased, but then draws a conclusion about the overall price of cigarettes. Those aren't the same thing. If the pre-tax price dropped when the tax increased, those two changes might cancel each other out, or the overall price might even go down despite the tax increase. Answer C tells us that the pre-tax price of cigarettes "gradually decreased throughout the year before ... the tax increase". If the price is gradually decreasing throughout the year, it surely is decreasing by at least one cent several times. The tax increase is only eight cents (it's not 8%, it's eight cents), so answer C makes it at least probable that the overall price of cigarettes was lower in the year after the tax hike than it was, on average, in the year before. And if that's the case, the evidence cited doesn't establish any relationship between after-tax price and smoking, so this contradicts the hypothesis.
E is a better answer than C if it means what I'm guessing it's trying to say (a strong economy leads to a reduction in the number of smokers and there was a strong economy in the year of the tax increase, so we have a different explanation for the smoking decrease). But I don't like these prep company questions that have two right answers, since you never see that on the actual GMAT.
But C is also a good answer. The stem points out that the tax alone increased, but then draws a conclusion about the overall price of cigarettes. Those aren't the same thing. If the pre-tax price dropped when the tax increased, those two changes might cancel each other out, or the overall price might even go down despite the tax increase. Answer C tells us that the pre-tax price of cigarettes "gradually decreased throughout the year before ... the tax increase". If the price is gradually decreasing throughout the year, it surely is decreasing by at least one cent several times. The tax increase is only eight cents (it's not 8%, it's eight cents), so answer C makes it at least probable that the overall price of cigarettes was lower in the year after the tax hike than it was, on average, in the year before. And if that's the case, the evidence cited doesn't establish any relationship between after-tax price and smoking, so this contradicts the hypothesis.
E is a better answer than C if it means what I'm guessing it's trying to say (a strong economy leads to a reduction in the number of smokers and there was a strong economy in the year of the tax increase, so we have a different explanation for the smoking decrease). But I don't like these prep company questions that have two right answers, since you never see that on the actual GMAT.
