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as per the argument " United states must change the tax code in order to encourage savings .
as per option E..change in tax code is not required coz majority of the population is in age group that believes more in saving than in consumption.
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Posted by: kidz
Economies in which a high percentage of resources are invested in research and development show greater growth in the long run than do those in which resources are channeled into consumption. Japanese workers spend a higher percentage of their income investing in research and development than do American workers.
To grow as fast as Japan has in the past three decades, the United States must change the tax code in order to encourage savings and investment and discourage debt.
Which of the following, if true, tends to weaken the argument?
(A) Japanese research is more focused on consumers than is research by American firms.
(B) Class mobility, highly valued in American culture, is encouraged by a growing rather than a stagnant economy.
(C) Studies have shown that countries with high consumption rates prosper in the short run.
(D) Proposed changes to the tax code could involve strict limits on the deductability of interest, and increased allowance for research.
(E) Because a decreasing percentage of the United States is under 40, an age when savings are traditionally low, the savings rate will increase without changes to the tax code.
IMO E
as per the argument " United states must change the tax code in order to encourage savings .
as per option E..change in tax code is not required coz majority of the population is in age group that believes more in saving than in consumption.
IMO E.
only option E explains why US government neednot do this change.
Agree with E.
IMO- E too
IMO B...........
IMO E....
E should be the answer. The key here is "Tax".
Official answer is E (hidden above) .. coudl you give some detailed explanation ?
@Kidz
The argument states that the tax codes should be changed in order to encourage savings.
But E states that, the percentage of Americans above 40 is increasing. It also goes on to state that people above the age of 40 tend to save more (they actually say that the younger part of the population doesn't save much, which in turn translates to the fact that the older generation tend to save more.). As a result of this, the savings rate of the Americans will grow. Since the savings rate is already growing, there is no point in changing the tax codes to encourage savings.
Consider this argument:
I have 4 siblings. I am the my parent's youngest child. We usually have very less food in the house, and with me being the youngest, I get the smallest portion of food. My share of food is clearly insufficient for me, so my parents should reconsider how they divide the food among my siblings and me.
Considering all the above is true, which of the following, if true, tends to weaken the argument?
E would then look like this:
My siblings will be moving out very soon.
In this case, the need to reconsider how food should be divided in our home would no longer exist. Something else is already fixing my problem.
it is a stupid example and I hope I haven't made it too complicated for you.
Last edited by swethapv; March 30th, 2009 at 09:47 AM.
Agree with Swethapv and deepak4mba
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