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Difficulty:
35%
(medium)
Question Stats:
71% (02:06) correct
29%
(02:15)
wrong
based on 410
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When deciding where to locate or relocate, businesses look for an educated work force, a high level of services, a low business-tax rate, and close proximity to markets and raw materials. However, although each of these considerations has approximately equal importance, the lack of proximity either to markets or to raw materials often causes municipalities to lose prospective businesses, whereas having a higher-than-average business-tax rate rarely has this effect.
Which one of the following, if true, most helps to resolve the apparent discrepancy in the statements above?
(A) Taxes paid by businesses constitute only a part of the tax revenue collected by most municipalities.
(B) In general, the higher the rate at which municipalities tax businesses, the more those municipalities spend on education and on providing services to businesses.
(C) Businesses sometimes leave a municipality after that municipality has raised its taxes on businesses.
(D) Members of the work force who are highly educated are more likely to be willing to relocate to secure work than are less highly educated workers.
(E) Businesses have sometimes tried to obtain tax reductions from municipalities by suggesting that without such a reduction the business might be forced to relocate elsewhere.
Source: LSAT
Which one of the following, if true, most helps to resolve the apparent discrepancy in the statements above?
(A) Taxes paid by businesses constitute only a part of the tax revenue collected by most municipalities.
(B) In general, the higher the rate at which municipalities tax businesses, the more those municipalities spend on education and on providing services to businesses.
(C) Businesses sometimes leave a municipality after that municipality has raised its taxes on businesses.
(D) Members of the work force who are highly educated are more likely to be willing to relocate to secure work than are less highly educated workers.
(E) Businesses have sometimes tried to obtain tax reductions from municipalities by suggesting that without such a reduction the business might be forced to relocate elsewhere.
Source: LSAT
15 May 2021, 01:49
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I do not believe, in my humble opinion, that this is a good question from the GMAT standing point.
The core of the problem is that a company when needs to evaluate a location then important factors come into the picture. However, one of the key factors are the proximity to the sources of supplies.
regardless the taxes paid. Of course, the more we can gain and being success, the more we can pay high taxes. We do not care to afford one million in taxes when we have a profit of 100 millions
The OA instead solves the paradox from the municipalities' standing point.
We should not have an interest in how the taxes are spent.
How can we solve the paradox ?' why the company does not care "having a higher-than-average business-tax rate rarely has this effect."??
Because if we , as a company, have a near source of supply or raw material, then we can work at the best, making millions of dollars. Then we will pay the highest taxes.....hey, but who cares
Regards
The core of the problem is that a company when needs to evaluate a location then important factors come into the picture. However, one of the key factors are the proximity to the sources of supplies.
regardless the taxes paid. Of course, the more we can gain and being success, the more we can pay high taxes. We do not care to afford one million in taxes when we have a profit of 100 millions
The OA instead solves the paradox from the municipalities' standing point.
We should not have an interest in how the taxes are spent.
How can we solve the paradox ?' why the company does not care "having a higher-than-average business-tax rate rarely has this effect."??
Because if we , as a company, have a near source of supply or raw material, then we can work at the best, making millions of dollars. Then we will pay the highest taxes.....hey, but who cares
Regards
