Last year, the US government spent $500B on enhancing employment, lead

Question

Last year, the US government spent $500B on enhancing employment, leading to creation of 10M jobs. An average job in US saves the government $10K in social security benefits and provides $15K in taxes. Based on this, the government claims that the payback on the investment would be less than 3 years.

The government’s claim is based on which of the following assumption?

(A) A significant number of the jobs that have been created are comparable to or better than an average job.
(B) Most of the jobs that have been created through this program will last 5 years or more.
(C) People employed through this program are doing work that will help the Gross exports of the nation.
(D) The excessive money spent to create these jobs will not raise the inflation in the country.
(E) All jobs are created equal with similar pay and benefits.

ABHRAJIT · Answer

A is correct.
Conclusion/Claim: payback on the investment would be less than 3 years.
Premise: An average job in US saves the government $10K in social security benefits and provides $15K in taxes.

If we negate option A, then most jobs created will be lower than the average job, which will make the payback time more than 3 years, thus the conclusion falls apart. Thus A is the assumption.

Tea12 · Answer

About choice E. 
I think that if "All jobs are created equal with similar pay and benefits" than people may or may not opt for these jobs, this creates ambiguity regarding the claim that "payback on the investment would be less than 3 years". Negating choice E works in favour of conclusion. Hence E, is wrong.

Palpable · Answer

Bunuel , please help explain

If an average job saves 10k and adds 15k in taxes, the scale could very well look like 50 jobs with $5B each, saving huge sums of money and adding huge sums of money in taxes. The average numbers would still hold and most jobs would not be comparable or more than the average job.

A does not hold. Am I missing something?

Posted from my mobile device

Maheshkv · Answer

Hi  Palpable ,

May be i can share my thoughts on your question. Although i do agree with the kind of scenario you have proposed. But in general i would recommend following the elimination approach for GMAT CR rather than validating the truthfulness of the correct option.

Coming to your assumed scenario, it is far beyond from practical and it is always advisable to keep the reasoning aligned with general sense. Happy to discuss!

ManifestDreamMBA · Answer

Treating it like a DS Q to check yes and no scenario

Money Spent = 500B
Jobs = 10M
$ Earning by govt by "avg job" = 25K

If all jobs are same or better than "avg job", then 25K *10M = 250 B, which makes the statement true that the government claims that the payback on the investment would be less than 3 years.

If say only 10% of the jobs are same or better than "avg job", then 25K *10M * 0.1 = 25 B, which makes the statement false that the government claims that the payback on the investment would be less than 3 years.

So, we need a balancing point above which the conclusion holds true, which option A does, suggesting  a significant number  of jobs that have been created are comparable to or better than an average job

Evaluating other options:
(B) Most of the jobs that have been created through this program will last 5 years or more.  Why 5 years, why not 3years? Even if they do last 3 years, the conclusion holds 
(C) People employed through this program are doing work that will help the Gross exports of the nation.  Nothing in the argument talks about Gross exports of the nation. Irrelevant 
(D) The excessive money spent to create these jobs will not raise the inflation in the country.  Nothing in the argument talks about Inflation. Also we do not know the effect of inflation 
(E) All jobs are created equal with similar pay and benefits.  No, we need majority of jobs to be similar or better than the "avg jobs". we don't need all of them to be equal

Last year, the US government spent $500B on enhancing employment, lead

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Last year, the US government spent $500B on enhancing employment, lead

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