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13 Jul 2025, 02:00
Kudos
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D
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
75%
(hard)
Question Stats:
49% (02:03) correct
51%
(02:28)
wrong
based on 225
sessions
History
Date
Time
Result
Not Attempted Yet
In the case of Class B apartments, landlords are allowed to revise rental rates once every five years, from the time of entering into a rental agreement. The landlord can increase the rent by adding to the previous rent a percentage increase, determined by the rate of inflation and the change in local property prices over the previous five-year period.
Which of the following statements, if true, is the best basis for a criticism of the method of calculating allowed rent increases as an economically appropriate method?
A. Many people decry the increasing percentage of their income that people must spend on rent.
B. Over the past thirty years, the rate of inflation has varied significantly.
C. The rent will be greatly affected by the changes in the locality of the apartment.
D. Renters might continue to pay for unfair rental rates negotiated in the past.
E. The suggested method of calculating rent increases might not encourage landlords to maintain Class B apartments very well.
Which of the following statements, if true, is the best basis for a criticism of the method of calculating allowed rent increases as an economically appropriate method?
A. Many people decry the increasing percentage of their income that people must spend on rent.
B. Over the past thirty years, the rate of inflation has varied significantly.
C. The rent will be greatly affected by the changes in the locality of the apartment.
D. Renters might continue to pay for unfair rental rates negotiated in the past.
E. The suggested method of calculating rent increases might not encourage landlords to maintain Class B apartments very well.
13 Jul 2025, 06:18
Kudos
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Bunuel
The rent increase is calculated on the basis of the previous rent. Hence, if the previous rent that the landlord charged was not correct the tenant may keep paying unfair prices.
A. Many people decry the increasing percentage of their income that people must spend on rent.
The information in this option is not related to the way rent is calculated. The option presents opinions of individual and this is not relevant to the question asked. The option can be eliminated
B. Over the past thirty years, the rate of inflation has varied significantly.
The calculation logic factors in the change in local property prices over the previous five-year period. Hence, the this information doesn't help us find a flaw in the way rents are calculated.
C. The rent will be greatly affected by the changes in the locality of the apartment.
While the locality might impact rent, the same would already have been factored in the current rent. Hence, option D doesn't show a flaw and can be elimianted.
D. Renters might continue to pay for unfair rental rates negotiated in the past.
This is indeed correct. If the rent paid by the tentant in past is unfair, the tenant will continue to pay unfair rents as the new rent will increase by a percentage of the previous rent. Hence, the method to calculate the rent is indeed a flawed one.
E. The suggested method of calculating rent increases might not encourage landlords to maintain Class B apartments very well.
The information is irrelevant. The aim of the question is to find a flaw in the method of calculating allowed rent increases, and the option doesn't provide any information around that.
Option D
P.S. This question is a reworded version of an official question that can be found here. - https://gmatclub.com/forum/the-price-th ... 88892.html
20 Jul 2025, 02:30
Kudos
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Bunuel
Experts' Global Explanation:
Mind-map: Class B apartment landlords can revise rents every five years à rents can be increased by a percentage of previous rent à increase percentage determined by inflation and increase in property rates in locality à method of calculating allowed rent increases is economically appropriate (implicit conclusion)
Missing-link: Between all the information presented and the conclusion that the method of calculating allowed rent increases is economically appropriate
Expectation from the correct answer choice: To weaken the conclusion that the method of calculating allowed rent increases is economically appropriate
A. The argument is concerned with whether the suggested method of calculating allowed rent increases is economically appropriate; whether many people disapprove the increase thus calculated provides no information about the economic appropriateness of the method; so, this answer choice is just a general opinion and does not weaken the argument. Because this answer choice does not weaken the conclusion, this answer choice is incorrect.
B. Trap. The argument mentions that the new rental rates would be calculated by considering inflation; so, if inflation has varied considerably in the past, it indicates that the increase in rental rates has varied; however, varying increase in rental rates provides no information about the economic appropriateness of the suggested method; so, this answer choice is just additional detail and does not weaken the conclusion. Because this answer choice does not weaken the conclusion, this answer choice is incorrect.
C. Trap. The argument mentions that the new rental rates would be calculated by considering the change in local property prices; so, this answer choice, suggesting the influence of the changes in the locality of the apartment, adds no new information and does not weaken the argument. Because this answer choice does not weaken the conclusion, this answer choice is incorrect.
D. Correct. The argument mentions that the new rental rates would be based on a percentage increase in previous rental rates; so, if the previous rental rates were poorly negotiated by renters, it indicates that the unfair rates would continue in successive rental agreements as well; so, this answer choice, highlighting this possibility, criticizes the suggested method on economic grounds, thus weakening the conclusion. Because this answer choice weakens the conclusion, this answer choice is correct.
E. Trap. The argument is concerned with whether the suggested method of calculating allowed rent increases is economically appropriate; how the landlords’ motivation to maintain apartments is impacted by the method provides no information about the appropriateness of the method; so, this answer choice is just additional information and does not weaken the argument. Because this answer choice does not weaken the conclusion, this answer choice is incorrect.
D is the best choice.
