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22 Sep 2004, 14:11
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Which of the following, if true, is the most logical completion of the argument below?
The tax system of the Republic of Grootland encourages borrowing by granting its taxpayers tax relief for interest paid on loans. The system also discourages saving by taxing any interest earned on savings. Nevertheless, it is clear that Grootland's tax system does not consistently favor borrowing over saving, for if it did, there would be no ____
A) tax relief in Grootland for those portions of a taxpayer's income, if any, that are set aside to increase that taxpayer's total savings
B) tax relief in Grootland for the processing fees that taxpayers pay to lending institutions when obtaining certain kinds of loans
C) tax relief in Grootland for interest that taxpayers are charged on the unpaid balance in credit card accounts
D) taxes due in Grootland on the cash value of gifts received by taxpayers from banks trying to encourage people to open savings accounts
E) taxes due in Grootland on the amount that a taxpayer has invested in interest-bearing savings accounts
The tax system of the Republic of Grootland encourages borrowing by granting its taxpayers tax relief for interest paid on loans. The system also discourages saving by taxing any interest earned on savings. Nevertheless, it is clear that Grootland's tax system does not consistently favor borrowing over saving, for if it did, there would be no ____
A) tax relief in Grootland for those portions of a taxpayer's income, if any, that are set aside to increase that taxpayer's total savings
B) tax relief in Grootland for the processing fees that taxpayers pay to lending institutions when obtaining certain kinds of loans
C) tax relief in Grootland for interest that taxpayers are charged on the unpaid balance in credit card accounts
D) taxes due in Grootland on the cash value of gifts received by taxpayers from banks trying to encourage people to open savings accounts
E) taxes due in Grootland on the amount that a taxpayer has invested in interest-bearing savings accounts
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THERE IS LIKELY A BETTER DISCUSSION OF THIS EXACT QUESTION.
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To review the GMAT Club's Forums Posting Guidelines, please follow these links: Quantitative | Verbal Please note - we may remove posts that do not follow our posting guidelines. Thank you.
22 Sep 2004, 15:09
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A it is
This is a classic double negative Q and I always get confused!
Basically the answer can be either "there's no tax relief for a situation where borrowing takes place" or "there's tax relief for a situation where savings takes place". A talks about the latter. Hope my logic is correct
This is a classic double negative Q and I always get confused!
Basically the answer can be either "there's no tax relief for a situation where borrowing takes place" or "there's tax relief for a situation where savings takes place". A talks about the latter. Hope my logic is correct
22 Sep 2004, 18:52
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Seems A is the answer. If it always favored borrowign, then there wouldn't be any tax relief for savings. A seems to imply there are some reliefs for savings.
A very difficult but interesting question !
A very difficult but interesting question !
