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Best Completes the passage ?

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by rashmi.kaushal » Sun Aug 29, 2010 3:30 am
Which of the following best completes the passage?

Critics of Country A's trade policy with Country Z contend that Country A's low tariffs are responsible for its large trade deficit with Country Z. Government officials, however, argue that there is a trade deficit with Country Z because low labor costs in Country Z allow its companies to manufacture goods cheaply. The officials also claim that economic competition from Country Z is responsible for better prices for Country A's consumers. Therefore, they say, the most logical way to lower the trade deficit without hurting Country A's consumers is to _________.

(A) raise the tariffs on goods imported from Country Z
(B) encourage businesses in Country A to reduce their labor costs
(C) increase taxes on all goods not manufactured in Country A
(D) improve the products manufactured by Country A's companies
and market them heavily in Country A
(E) subsidize all of Country A's companies that manage to
maintain their prices at the level of the goods produced by
Country Z
OA- Later
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Source: — Critical Reasoning |

by puneetdua » Sun Aug 29, 2010 4:12 am
Stuck betweek B and E-

Finally choosing - B , what is the OA?

a) Raising tarriffs - will effect consumer in A
b)
c)increasing taxes - wil effect consumer in A
d)Impreove the products - but still it will be expensive in comparision with Z/'z product
e)Subsidizing only few companies , which are maintaining prices at level of Z only - wont help lower the trade deficit...

OA please ..
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by rashmi.kaushal » Sun Aug 29, 2010 4:36 am
B, I was also confused between B&E thnks fr the explanation
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by diebeatsthegmat » Sun Aug 29, 2010 5:34 pm
rashmi.kaushal wrote:Which of the following best completes the passage?

Critics of Country A's trade policy with Country Z contend that Country A's low tariffs are responsible for its large trade deficit with Country Z. Government officials, however, argue that there is a trade deficit with Country Z because low labor costs in Country Z allow its companies to manufacture goods cheaply. The officials also claim that economic competition from Country Z is responsible for better prices for Country A's consumers. Therefore, they say, the most logical way to lower the trade deficit without hurting Country A's consumers is to _________.

(A) raise the tariffs on goods imported from Country Z
(B) encourage businesses in Country A to reduce their labor costs
(C) increase taxes on all goods not manufactured in Country A
(D) improve the products manufactured by Country A's companies
and market them heavily in Country A
(E) subsidize all of Country A's companies that manage to
maintain their prices at the level of the goods produced by
Country Z
OA- Later
also confusing between B and E but maybe i will choose E ....
what is the answer?
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by reply2spg » Mon Aug 30, 2010 6:55 am
What is wrong with E?

rashmi - Can you post the source and original explanation to eliminate E?
Sudhanshu
(have lot of things to learn from all of you)
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by norizam » Mon Aug 30, 2010 11:41 pm
rashmi.kaushal wrote:Which of the following best completes the passage?

Critics of Country A's trade policy with Country Z contend that Country A's low tariffs are responsible for its large trade deficit with Country Z. Government officials, however, argue that there is a trade deficit with Country Z because low labor costs in Country Z allow its companies to manufacture goods cheaply. The officials also claim that economic competition from Country Z is responsible for better prices for Country A's consumers. Therefore, they say, the most logical way to lower the trade deficit without hurting Country A's consumers is to _________.

Two ways to reduce trade deficits: reduce labor cost and/or reduce the economic competition

(A) raise the tariffs on goods imported from Country Z
(B) encourage businesses in Country A to reduce their labor costs
Hopefully, this allows the manufacturers in country A to produce good cheaply, and therefore will not hurting the consumers
(C) increase taxes on all goods not manufactured in Country A
(D) improve the products manufactured by Country A's companies
and market them heavily in Country A
(E) subsidize all of Country A's companies that manage to
maintain their prices at the level of the goods produced by
Country Z
Subsidies do not reduce labor cost of those companies, rather they help companies pay the salary. Therefore subsidies will not lower the trade deficit
OA- Later
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