I would pick A

- pradeep

IMO A

Couldn't able to comprehend fully

Could someone explain following line: farmers who took 25 percent of their cotton acreage out of production direct support payments up to a specified maximum per farm. Also, I feel, there has to be a comma between 'production' and 'direct'.

As we can't skip any question, IMO D

A, between A and D using POE.

i liked D, because it says that govt wont need to pay as much for the larger farms. the flaw with D is that it doesn't indicate how the govt will make up any of the deficit.

so i was left with A. althought i do not like A either, i guess one justification for A could be using A as evidence. If govt lost tax revenue from depressed prices in the past, then cotton prices will likely rise via the new program due to lower acreage. then higher revenues = higher taxes which will offset the direct support payments.

i hate gmat.

IMO A:

the stimulus says: no burden on the budget

now if the cotton prices remain normal... govt will receive taxes as X
Q*P

Q --QUINTALS
P PRICE PER QUINTAL

Now after 25 % off
.75q*p or probably .75q*r ( r > p)
now add ( this taxes- govt expenditure ) = New taxes

+ what about 25 % land ( some other crop can also be grown )

D:

This essentially tells that compensation would be equal to farmers
This does not suggest how extra money would come to govt..to overcome this spending..

niraj_a wrote:i hate gmat.

Never hate anything or anyone Atleast, not something inanimate such as GMAT.

karmayogi wrote:

niraj_a wrote:i hate gmat.

Never hate anything or anyone Atleast, not something inanimate such as GMAT.

Guruji ki jai hoo.....

Hello!
Thanks four posts, folks!
OA is A, but I am tryin to understand what is going on with the cotton
prices and government interventions. but it is being difficut due to language barrier.

In order to boost cotton prices, government offers the farmers to cut 25% of land that
was used to grow cotton. And, moreover, government wants to support those farmers
with some compensation. And these actions won't be a burden on a budget.

Well, A says: If the farmers don't cut production and if government does not support
those farmers, both gov-t and farmers will lose due to depressed cotton prices.

So, the statement is correct based on A.
Is the way of analyzing correct?

Feruza Matyakubova wrote:Hello!
Thanks four posts, folks!
OA is A, but I am tryin to understand what is going on with the cotton
prices and government interventions. but it is being difficut due to language barrier.

In order to boost cotton prices, government offers the farmers to cut 25% of land that
was used to grow cotton. And, moreover, government wants to support those farmers
with some compensation. And these actions won't be a burden on a budget.

Well, A says: If the farmers don't cut production and if government does not support
those farmers, both gov-t and farmers will lose due to depressed cotton prices.

So, the statement is correct based on A.
Is the way of analyzing correct?

Well .. the govt doesn't offer the farmers to cut 25% of the land .. they'll support the farmers by buying the crops grown in up to 25% of the farm land. So for instance if a farmer has 10 acres and he grows 100lbs of cotton per acre - govt will buy 25% of 1000 lbs.

This is essentially a cotton farming subsidy. Hope this explanation helps.

- pradeep

In my opinion A is the most logical one.