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# When a city experiences a sharp decline in population, the city's tax

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When a city experiences a sharp decline in population, the city's tax  [#permalink]

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Updated on: 20 Mar 2019, 21:31
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When a city experiences a sharp decline in population, the city's tax revenues, which pay for such city services as police protection and maintenance of water lines, also decrease. The area to be policed and the number and length of the water lines to be maintained, however, do not decrease. Attempting to make up the tax revenue lost by raising tax rates is not feasible, since higher tax rates would cause even more residents to leave.

The information given most strongly supports which of the following general claims?

A. If, in a city with sharply declining population, police protection and water line maintenance do not deteriorate, some other service previously provided by the city will deteriorate or be eliminated.

B. If a city's tax rates are held stable over a period of time, neither the population nor the levels of city services provided will tend to decline over that period.

C. If a city's population declines sharply, police protection and water line maintenance are the services that deteriorate most immediately and most markedly.

D. A city that suffers revenue losses because of a sharp decline in population can make up some of the lost tax revenue by raising tax rates, provided the city's tax rates are low in relation to those of other cities.

E. A city that is losing residents because tax rates are perceived as too high by those residents can reverse this population trend by bringing its tax rates down to a more moderate level.

Originally posted by Vineetk on 13 Nov 2012, 00:29.
Last edited by Bunuel on 20 Mar 2019, 21:31, edited 1 time in total.
Renamed the topic and edited the question.
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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29 Oct 2018, 00:36
3
Vineetk wrote:
When a city experiences a sharp decline in population, the city's tax revenues, which pay for such city services as police protection and maintenance of water lines, also decrease. The area to be policed and the number and length of the water lines to be maintained, however, do not decrease. Attempting to make up the tax revenue lost by raising tax rates is not feasible, since higher tax rates would cause even more residents to leave.

The information given most strongly supports which of the following general claims?

A. If, in a city with sharply declining population, police protection and water line maintenance do not deteriorate, some other service previously provided by the city will deteriorate or be eliminated.

B. If a city's tax rates are held stable over a period of time, neither the population nor the levels of city services provided will tend to decline over that period.

C. If a city's population declines sharply, police protection and water line maintenance are the services that deteriorate most immediately and most markedly.

D. A city that suffers revenue losses because of a sharp decline in population can make up some of the lost tax revenue by raising tax rates, provided the city's tax rates are low in relation to those of other cities.

E. A city that is losing residents because tax rates are perceived as too high by those residents can reverse this population trend by bringing its tax rates down to a more moderate level.

Premises:
Sharp decline in population causes tax revenue to reduce.
But the areas which this revenue supports is still the same such as police protection and maintenance of water lines.
We cannot make up by increasing tax rate since more people will leave.

We need a conclusion. Something that follows from what is given. There should be no new information.

A. If, in a city with sharply declining population, police protection and water line maintenance do not deteriorate, some other service previously provided by the city will deteriorate or be eliminated.
The tax revenues decrease when population decreases. Since the revenues cannot be recovered by raising tax rate (since it will mean more people leaving and consequently lower collection points), it means the revenue will reduce. The need for the revenue does not reduce for at least some services. Hence, some services will certainly suffer. If police protection and water line maintenance do not suffer, something will suffer.
This follows what is given to us in the argument. There is nothing called "this option is incorrect due to usage of extreme language". If the premises give you extreme data, the option will use extreme language.
If the premises give you: "If A happens, B will happen." and "A has happened", what will you conclude? That B WILL HAPPEN. Can you say that the language is too extreme here? No.

B. If a city's tax rates are held stable over a period of time, neither the population nor the levels of city services provided will tend to decline over that period.
We do not know what causes the population to decline. Irrelevant.

C. If a city's population declines sharply, police protection and water line maintenance are the services that deteriorate most immediately and most markedly.
Not known. When the revenue declines, which services take the hit, we don't know. All we can say is that some service will take a hit.

D. A city that suffers revenue losses because of a sharp decline in population can make up some of the lost tax revenue by raising tax rates, provided the city's tax rates are low in relation to those of other cities.
What happens when the city increases tax rate, we cannot say. The premises give us that we cannot make up for lost revenue by increasing tax rate. Are we able to make up for it partially provided the tax rate still remains low, we cannot say. Note that we have no information on why people choose a certain city to live in. Perhaps its tax rate is lower but the quality of air and water isn't that great. Perhaps its cost of living is high. What happens when the tax rate is increased slightly (but is still less than other cities), overall it may not make financial sense for people to stay. The point is, we don't know how people will react if the taxes are raised even a tiny bit. We do know that raising tax rates cannot make up the loss in revenue and that is all. The argument tells us nothing else. We have to stick to the universe created by our argument.

E. A city that is losing residents because tax rates are perceived as too high by those residents can reverse this population trend by bringing its tax rates down to a more moderate level.
Irrelevant. We don't know how to reverse population trend and whether it can be reversed in the first place.

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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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25 May 2013, 23:09
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Vineetk wrote:
When a city experiences a sharp decline in population, the city's tax revenues, which pay for such city services as police protection and maintenance of water lines, also decrease. The area to be policed and the number and length of the water lines to be maintained, however, do not increase. Attempting to make up the tax revenue lost by raising tax rates is not feasible, since higher tax rates would cause even more residents to leave.

The information given most strongly supports which of the following general claims?

A. If, in a city with sharply declining population, police protection and water line maintenance do not deteriorate, some other service previously provided by the city will deteriorate or be eliminated.
B. If a city's tax rates are held stable over a period of time, neither the population nor the levels of city services provided will tend to decline over that period.
C. If a city's population declines sharply, police protection and water line maintenance are the services that deteriorate most immediately and most markedly.
D. A city that suffers revenue losses because of a sharp decline in population can make up some of the lost tax revenue by raising tax rates, provided the city's tax rates are low in relation to those of other cities.
E. A city that is losing residents because tax rates are perceived as too high by those residents can reverse this population trend by bringing its tax rates down to a more moderate level.

OA post discussion

First the question stem here is must be true/inference-

Use the fact test and eliminate each ans choice if it fails the fact test

E- No where can we prove it from the given premises. (reverse the trend???)
D- tricky.... hmm first half is true but in the second half he talks about other cities which cannot be proved again
C- Most immidiately and markedly should be ringing bells in your head. Again a NO NO
B- Tricky again- But can we definitively ask ... 'ok everything is stable, but can i ensure that the people stay back??' NO.....
A- Only ans left Though I do not like the sentence 'some services will be eliminated'... but close enough
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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13 Nov 2012, 01:14
4
Vineetk wrote:
When a city experiences a sharp decline in population, the city's tax revenues, which pay for such city services as police protection and maintenance of water lines, also decrease. The area to be policed and the number and length of the water lines to be maintained, however, do not increase. Attempting to make up the tax revenue lost by raising tax rates is not feasible, since higher tax rates would cause even more residents to leave.

The information given most strongly supports which of the following general claims?

A. If, in a city with sharply declining population, police protection and water line maintenance do not deteriorate, some other service previously provided by the city will deteriorate or be eliminated.
B. If a city's tax rates are held stable over a period of time, neither the population nor the levels of city services provided will tend to decline over that period.
C. If a city's population declines sharply, police protection and water line maintenance are the services that deteriorate most immediately and most markedly.
D. A city that suffers revenue losses because of a sharp decline in population can make up some of the lost tax revenue by raising tax rates, provided the city's tax rates are low in relation to those of other cities.
E. A city that is losing residents because tax rates are perceived as too high by those residents can reverse this population trend by bringing its tax rates down to a more moderate level.

OA post discussion

interesting question! Kudos!

tough to choose between A and D. However, since question talks about no relation to tax rates of other cities therefore it could be simply that tax hikes are just like last nail in coffin and make more residents leave the city irrespective whether tax rates are lower compared to other cities.
Further, A gets more strong considering population is sharply 'declining', therefore eventually tax revenue would be low enough to cause one or more services to deteriorate.

Ans A it is!
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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13 Nov 2012, 03:28
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OA is A.

OE explains that the distribution of revenues among city services is unknown and how this might change is also unknown. Even if the overall funds decline, revenues for some specific city services could remain same while revenues for other services are severely cut.

Reason for A- If police protection and water lines have not deteriorated as population has declined, then probably the funding for them has been preserved. Therefore, funding for some other services must be severely cut , since making up revenue lost due to population decrease is not feasible.
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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25 Sep 2013, 18:52
2
2
When a city experiences a sharp decline in population, the city's tax revenues, which pay for such city services as police protection and maintenance of water lines, also decrease. The area to be policed and the number and length of the water lines to be maintained, however, do not increase. Attempting to make up the tax revenue lost by raising tax rates is not feasible, since higher tax rates would cause even more residents to leave.

population decline --> tax revenue decrease
police protection and water line maintenance not increase + tax rate can not raise --> ???

The information given most strongly supports which of the following general claims?

A. If, in a city with sharply declining population, police protection and water line maintenance do not deteriorate, some other service previously provided by the city will deteriorate or be eliminated.
correct : given information results in deterioration in service provided by the city

B. If a city's tax rates are held stable over a period of time, neither the population nor the levels of city services provided will tend to decline over that period.
the given information tells about causal relationship between raising tax rate and decrease in population, not in the case the tax rates are stable

C. If a city's population declines sharply, police protection and water line maintenance are the services that deteriorate most immediately and most markedly.
the given information does not provide the comparison between police protection and water line maintenance with other provided service

D. A city that suffers revenue losses because of a sharp decline in population can make up some of the lost tax revenue by raising tax rates, provided the city's tax rates are low in relation to those of other cities.
even though the city's tax rates are low, increasing tax rate cannot make up some of the tax lost

E. A city that is losing residents because tax rates are perceived as too high by those residents can reverse this population trend by bringing its tax rates down to a more moderate level.
the given information tells about causal relationship between raising tax rate and decrease in population, not in the case the tax rates decreasing
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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10 Jul 2016, 17:00
So just to sum up the discussion above, A is strong because of the premise in the stimulus that states that higher tax revenue would just further the problem, and with less tax revenue there will be other services not provided if water and policing is not deteriorating?

D looks too good to be true on a problem like this. I still went with it although had a feeling it was wrong because we don't know the behavior to other cities.

Please clarify my reasoning if I am wrong.
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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04 Oct 2016, 08:43
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In between A and D we can readily remove D because as per D, the people will avoid moving to the other cities if the taxes there are higher as compared to their current city. But what if in the other cities the taxes are higher alongwith higher incomes and other better facilities then the people might consider moving to these other cities
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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26 Oct 2016, 06:44
2
Vineetk wrote:
When a city experiences a sharp decline in population, the city's tax revenues, which pay for such city services as police protection and maintenance of water lines, also decrease. The area to be policed and the number and length of the water lines to be maintained, however, do not increase. Attempting to make up the tax revenue lost by raising tax rates is not feasible, since higher tax rates would cause even more residents to leave.

The information given most strongly supports which of the following general claims?

A. If, in a city with sharply declining population, police protection and water line maintenance do not deteriorate, some other service previously provided by the city will deteriorate or be eliminated.
B. If a city's tax rates are held stable over a period of time, neither the population nor the levels of city services provided will tend to decline over that period.
C. If a city's population declines sharply, police protection and water line maintenance are the services that deteriorate most immediately and most markedly.
D. A city that suffers revenue losses because of a sharp decline in population can make up some of the lost tax revenue by raising tax rates, provided the city's tax rates are low in relation to those of other cities.
E. A city that is losing residents because tax rates are perceived as too high by those residents can reverse this population trend by bringing its tax rates down to a more moderate level.

I have nothing to add to the discussion; nevertheless, the argument has an error: where it says “The area to be policed and the number and length of the water lines to be maintained, however, do not increase” it should say “The area to be policed and the number and length of the water lines to be maintained, however, do not decrease.”

As it is written, there is the possibility that “the area to be policed and the number and length of the water lines to be maintained” will decrease. Then the city could make up the tax revenue lost by reducing expenses in police protection and water line maintenance, without deteriorating them. So A would not be the answer.

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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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16 Nov 2016, 21:34
alpham wrote:
So just to sum up the discussion above, A is strong because of the premise in the stimulus that states that higher tax revenue would just further the problem, and with less tax revenue there will be other services not provided if water and policing is not deteriorating?

D looks too good to be true on a problem like this. I still went with it although had a feeling it was wrong because we don't know the behavior to other cities.

Please clarify my reasoning if I am wrong.

D is wrong because the last sentence in the argument “Attempting to make up the tax revenue lost by raising tax rates is not feasible, since higher tax rates would cause even more residents to leave.” tells us that raising taxes is NOT an option and we should take it as a premise namely that we can't question it.

yet in A, I can infer the funding for other survice must be reduced, but a reduce in funding doesn't neccessrily mean that other services will deteriorate or be eliminated. maybe the costs of the services just go down. plz clarify.
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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28 Nov 2016, 03:40
I guess the question and answer is not clear enough. what is theory behind the answer regardless the details.
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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01 Dec 2016, 06:47
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hatemnag wrote:
I guess the question and answer is not clear enough. what is theory behind the answer regardless the details.

Population decrease. So tax collected decrease. This collected tax is used for maintenance of various services in the city. However maintenance cost for police and water service does not decrease. So, if the police and water service does not deteriorate ( i.e. the expenditures in these services remain the same), then some other service would deteriorate ( i.e. expense in some other service would decrease).
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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01 Jan 2017, 11:03
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bjh wrote:
alpham wrote:
So just to sum up the discussion above, A is strong because of the premise in the stimulus that states that higher tax revenue would just further the problem, and with less tax revenue there will be other services not provided if water and policing is not deteriorating?

D looks too good to be true on a problem like this. I still went with it although had a feeling it was wrong because we don't know the behavior to other cities.

Please clarify my reasoning if I am wrong.

D is wrong because the last sentence in the argument “Attempting to make up the tax revenue lost by raising tax rates is not feasible, since higher tax rates would cause even more residents to leave.” tells us that raising taxes is NOT an option and we should take it as a premise namely that we can't question it.

yet in A, I can infer the funding for other survice must be reduced, but a reduce in funding doesn't neccessrily mean that other services will deteriorate or be eliminated. maybe the costs of the services just go down. plz clarify.

For the services for which the expenses are proportional to the no. of people, the expenses per person would not go down proportionally more than the tax received per person because of drop in population. If it did (illogical), only then your reasoning would be valid. Take the following hypothetical case for understanding:

Suppose there are 4 services and previously per person expenses were equal to per person taxes:
1. Service 1: expenses proportional to no. of people served
2. Service 2 : expenses proportional to no. of people served
3. Water line maintenance: fixed
4. Police protection: fixed

If the no. of people goes down, then the per person expense becomes higher than the per person taxes (because 3 and 4 are fixed expenses). Therefore if 3 and 4 do not deteriorate, 1 and 2 would.
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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05 Feb 2017, 08:18
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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06 Feb 2017, 06:43
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techiesam wrote:

It is not stated in the passage that raising tax rates is the ONLY reason for population decrease. There could be other reasons that lead to decline in population. Hence Option B is wrong.
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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10 Feb 2017, 18:21
The information given most strongly supports which of the following general claims?

A. If, in a city with sharply declining population, police protection and water line maintenance do not deteriorate, some other service previously provided by the city will deteriorate or be eliminated.
The correct answer as we are only assesing the current situation and and predict the possible outcome not making further plans like other choices.

B. If a city's tax rates are held stable over a period of time, neither the population nor the levels of city services provided will tend to decline over that period.
The services will certainly decline in quality as already mentioned in the argument.
C. If a city's population declines sharply, police protection and water line maintenance are the services that deteriorate most immediately and most markedly.
There may be other services apart from the police and water services but its not necessary that these services will be the once deteriorate the max.
D. A city that suffers revenue losses because of a sharp decline in population can make up some of the lost tax revenue by raising tax rates, provided the city's tax rates are low in relation to those of other cities.
The planning is not discussed and the current situation is discussed.
E. A city that is losing residents because tax rates are perceived as too high by those residents can reverse this population trend by bringing its tax rates down to a more moderate level.
The planning is not discused and the future effects of that planning is clearly out of scope and we need to assess the currnt situation only.
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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27 Feb 2017, 22:44
hi
expert
please shed some light on answer option B , although i have chose A BUT NOT CONVINCED WITH OE PROVIDED ABOVE , I AM HAVING A DOUBT REGARDING OPTION A THAT HOW CAN WE ASSUME OUT OF THE STIMULUS AS IT IS AN INFERENCE QUE!
KINDLY EXPLAIN

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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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28 Feb 2017, 01:28
nks2611, are you referring to the explanation by sayantanc2k? There's no assumption involved there. The argument tells us that if tax rates go up, more people will be enticed to leave. But that doesn't mean that if tax rates DON'T go up, people WON'T leave. They may still leave for other reasons, as Sayantan points out. This doesn't rely an assumption, but rather shows that B relies on one! For B to be right, we have to assume that people only leave town to avoid higher taxes. In logic, this is know as an illegal negation: If we are told a-->b, we can't infer NOT a --> NOT b.
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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01 Jun 2017, 18:38
Vineetk wrote:
When a city experiences a sharp decline in population, the city's tax revenues, which pay for such city services as police protection and maintenance of water lines, also decrease. The area to be policed and the number and length of the water lines to be maintained, however, do not decrease. Attempting to make up the tax revenue lost by raising tax rates is not feasible, since higher tax rates would cause even more residents to leave.

The information given most strongly supports which of the following general claims?

A. If, in a city with sharply declining population, police protection and water line maintenance do not deteriorate, some other service previously provided by the city will deteriorate or be eliminated.
B. If a city's tax rates are held stable over a period of time, neither the population nor the levels of city services provided will tend to decline over that period.
C. If a city's population declines sharply, police protection and water line maintenance are the services that deteriorate most immediately and most markedly.
D. A city that suffers revenue losses because of a sharp decline in population can make up some of the lost tax revenue by raising tax rates, provided the city's tax rates are low in relation to those of other cities.
E. A city that is losing residents because tax rates are perceived as too high by those residents can reverse this population trend by bringing its tax rates down to a more moderate level.

It is not D or E because by a lower tax rate it may not be possible to retain the population. The decline may be for other reasons and may continue regardless of the tax rate The tax rate only makes the problem worse. In the case of D, the tax rates are still higher and according to the argument any tax rate higher than what it was, will only make the situation worse.

A is correct because police protection and water line maintenance are something for which a constant amount need to be spent. So if they do not deteriorate or in other words the money spent on them are maintained, the other services will automatically suffer because of decline in tax revenue.
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Re: When a city experiences a sharp decline in population, the city's tax  [#permalink]

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03 Jun 2017, 08:52
When a city experiences a sharp decline in population, the city's tax revenues, which pay for such city services as police protection and maintenance of water lines, also decrease. The area to be policed and the number and length of the water lines to be maintained, however, do not decrease. Attempting to make up the tax revenue lost by raising tax rates is not feasible, since higher tax rates would cause even more residents to leave.

The information given most strongly supports which of the following general claims?

A. If, in a city with sharply declining population, police protection and water line maintenance do not deteriorate, some other service previously provided by the city will deteriorate or be eliminated.

B. If a city's tax rates are held stable over a period of time, neither the population nor the levels of city services provided will tend to decline over that period. Not relevant

C. If a city's population declines sharply, police protection and water line maintenance are the services that deteriorate most immediately and most markedly. Can not be inferred properly

D. A city that suffers revenue losses because of a sharp decline in population can make up some of the lost tax revenue by raising tax rates, provided the city's tax rates are low in relation to those of other cities. Out of scope

E. A city that is losing residents because tax rates are perceived as too high by those residents can reverse this population trend by bringing its tax rates down to a more moderate level.
Not necessarily true
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Re: When a city experiences a sharp decline in population, the city's tax   [#permalink] 03 Jun 2017, 08:52

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