-
abcgmat
- Master | Next Rank: 500 Posts
- Posts: 222
- Joined: Sat Aug 27, 2011 1:06 pm
- Thanked: 19 times
- Followed by:1 members
The United States government uses only a household's cash income before taxes to
determine whether that household falls below the poverty line in a given year; capital gains,
non-cash government benefits, and tax credits are not included. However, yearly cash
income is not a fool-proof measure of a given household's disposable income. For example,
retirees who live off of capital gains from an extensive portfolio could earn hundreds of
thousands of dollars, yet be classified by the government as living in "poverty" because this
income is not included in the calculation. Which of the following, if true, validates the
contention that the government's calculation methods must be altered in order to provide
statistics that measure true poverty?
A) For more than 99% of those classified as living in poverty, yearly cash income comprises the
vast majority of each household's disposable income.
b) While the government's calculation method indicated a 12.5% poverty rate in 2003, the
same calculation method indicated anywhere from a 9% to a 16% poverty rate during the
preceding decade.
c) Most established research studies conducted by the private sector indicate that the number of
people truly living in poverty in the U.S. is less than that indicated by the government's
calculation method.
d) Several prominent economists endorse an alternate calculation method which incorporates
all income, not just cash income, and adjusts for taxes paid and other core expenses.
e) The government's calculation method also erroneously counts those who do not earn income
in a given year but who have substantial assets on which to live during that year.
[spoiler]OA:C[/spoiler]
Would like to know how E is wrong.
Argument: Government calculation method includes people who are not poor but are tagged as poor because their household's cash income is under poverty level but they get income from elsewhere which is not included in the calculation method
Conclusion: The calculation must be altered to provide true measure of poverty.
Assumption: The other method exists . Or Method is not representative of true poverty
I am confused between C and E
Is E wrong because it is already presented in passage and is not a new Info
and C is New information and hence is a strengthener
determine whether that household falls below the poverty line in a given year; capital gains,
non-cash government benefits, and tax credits are not included. However, yearly cash
income is not a fool-proof measure of a given household's disposable income. For example,
retirees who live off of capital gains from an extensive portfolio could earn hundreds of
thousands of dollars, yet be classified by the government as living in "poverty" because this
income is not included in the calculation. Which of the following, if true, validates the
contention that the government's calculation methods must be altered in order to provide
statistics that measure true poverty?
A) For more than 99% of those classified as living in poverty, yearly cash income comprises the
vast majority of each household's disposable income.
b) While the government's calculation method indicated a 12.5% poverty rate in 2003, the
same calculation method indicated anywhere from a 9% to a 16% poverty rate during the
preceding decade.
c) Most established research studies conducted by the private sector indicate that the number of
people truly living in poverty in the U.S. is less than that indicated by the government's
calculation method.
d) Several prominent economists endorse an alternate calculation method which incorporates
all income, not just cash income, and adjusts for taxes paid and other core expenses.
e) The government's calculation method also erroneously counts those who do not earn income
in a given year but who have substantial assets on which to live during that year.
[spoiler]OA:C[/spoiler]
Would like to know how E is wrong.
Argument: Government calculation method includes people who are not poor but are tagged as poor because their household's cash income is under poverty level but they get income from elsewhere which is not included in the calculation method
Conclusion: The calculation must be altered to provide true measure of poverty.
Assumption: The other method exists . Or Method is not representative of true poverty
I am confused between C and E
Is E wrong because it is already presented in passage and is not a new Info
and C is New information and hence is a strengthener
