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by prashant misra » Sun Sep 04, 2011 6:06 am
i chose the option D which is definitely wrong after i checked the post.can anyone explain me the question in correlation with the options given as i am not able to decipher what statements should correctly follow
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by badpoem » Mon Sep 05, 2011 7:16 am
I chose E and after reading through the posts I am confused.

Owners of capital goods receive a share of this income that is no greater than the proportion of total output attributable to the use of capital goods. --> quite convoluted! In a real GMAT, I would invariably ignore this one, honestly!
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by navami » Tue Sep 06, 2011 1:57 am
Dear Becky,

Thanks for the explanation.
This time no looking back!!!
Navami
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by JS_2 » Fri Sep 09, 2011 1:58 am
Ans is C

The passage says" In modern economies about one-third of the total output of consumer goods is attribut-able to the use of capital goods. "
and the returns that they get is less than 1/3 as a part of it is paid as wages.
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by parul9 » Mon Sep 26, 2011 9:04 am
It's C.
Can anyone plz tell what should be the ideal time for this qsn??
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by Empirestateofmind » Thu Sep 29, 2011 9:29 pm
I also think that C is the correct answer. Becky has given a good explanation.
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by immaculatesahai » Wed Nov 09, 2011 6:37 am
tpr-becky wrote:one-third of the total output of
(30) consumer goods is attribut-
able to the use of capital
goods. Approximately two-
thirds of the income derived
from this total output is paid
(35) out to workers as wages and
salaries, the remaining third
serving as compensation
to the owners of the capital
goods. Moreover, part
(40) of this remaining third is
received by workers who
are shareholders, pension
beneficiaries, and the like.


This is hte passage the answer comes from and it basically says that Capital is responsible for 1/3 of the output and in return they gain 1/3 of the profit but have to pay some of that to workers who are shareholders etc..

C. This is true becuase they recieve a chaser and that share is 1/3 minus the part they pay out so it is no greater than the 1/3 you can attribute the output to.

d. We aren't sure about htis becuase it says fully compensated for their investment and we don't have enough info to knwo what that would be and it says they pay out MOST of their share to workers but the passage only says a part.

e. This may be true becuase they get their 2/3 plus extra if they are shareholders but the reason given for it goes beyond the passage.

Therefore, I believe C is the answer.

Very nice explanation. We need to take the passage as literally as possible. C is the best answer.
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by ReyWilli » Thu Dec 08, 2011 11:24 am
I intially thought D but I'm going with C.

A)This contradicts passage which says "two-thirds of income" is paid to workers.
B)This contradicts passage since "1/3 goes to capital goods" and "2/3 goes to worker wages" and "remaining 1/3 to owners"
C) Since "1/3 total output goes to capital goods" and "remaining 1/3 is compensation to owners", then supports owners is no greater than 1/3.
D)"Pay out most of thier share in income". I dont see where passage explicitly mentions this.
E)"overestimates thier contribution". I dont see where passage states this either.
GMATJunky
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by nitts » Wed Feb 22, 2012 12:48 pm
C or D
what do u say?
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by sullykma » Mon Mar 05, 2012 12:18 am
I think answer E is definitely wrong, bec. the question is asking according to the author. we have to remember by last paragraph that author is not supporting the theory of labour. And we can not make conclusion that workers received more than they contributed to capital goods according to the passage. So C is must be true.
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by elenaelena » Tue Jun 19, 2012 8:17 am
I didnt find this that difficult, with the process of illumination ive picked C:)
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by katy_123 » Tue Aug 21, 2012 7:49 pm
Which of the following arguments would a proponent of the labor theory of value, as it is presented in the first paragraph, be most likely to use in response to the statement that "The labor theory of value systematically disregards the productive contribution of capital goods"?

A. The productive contributions of workers and capital goods cannot be compared because the productive life span of capital goods is longer than that of workers.
B. The author's analysis of the distribution of income is misleading because only a small percentage of workers are also shareholders.
C. Capital goods are valuable only insofar as they contribute directly to the production of consumer goods.
D. The productive contribution of capital goods must be discounted because capital goods require maintenance.
E. The productive contribution of capital goods must be attributed to labor because capital goods are themselves products of labor.

I am stuck between A and E
The doubt I have in E is capital goods will be produced by different laborers then how can these laborers get the benefits?

Please option A and E
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by mohan514 » Sat Aug 25, 2012 3:58 pm
i reached the answer as the further reduction in share to the employer is due to shjare holders rather than workers which has already been discussed..


can anyone please explain if its wrong
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by anjalimanas » Wed Aug 29, 2012 11:02 pm
Option E wrong because :- the labor theory disregards the productive contribution of capital goods. There is no mention that it overestimates the worker's share to total output.
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by rajeshsinghgmat » Sun Jan 20, 2013 6:01 pm
C the answer.
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