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OG10 Problem no -195, need help..!!

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OG10 Problem no -195, need help..!!

by saurabh_wakhare » Mon Apr 16, 2012 5:59 am
A proposed change to federal income tax laws would eliminate deductions from taxable income for donations a taxpayer has made to charitable and educational institutions. If this change were adopted, wealthy individuals would no longer be permitted such deductions. Therefore, many charitable and educational institutions would have to reduce services, and some would have to close their doors.
The argument above assumes which of the following?
(A) Without the incentives offered by federal income tax laws, at least some wealthy individuals would not donate as much money to charitable and educational institutions as they otherwise would have.
(B) Money contributed by individuals who make their donations because of provisions in the federal tax laws provides the only source of funding for many charitable and educational institutions.
(C) The primary reason for not adopting the proposed change in the federal income tax laws cited above is to protect wealthy individuals from having to pay higher taxes.
(D) Wealthy individuals who donate money to charitable and educational institutions are the only individuals who donate money to such institutions.
(E) Income tax laws should be changed to make donations to charitable and educational institutions the only permissible deductions from taxable income.


As the conclusion says " many charitable and educational institutions would have to reduce services, and some would have to close their doors". I thought choice D would be most appropriate with reference to the conclusion. But book says A is most appropriate choice.
Please help..!!!
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by Birottam Dutta » Mon Apr 16, 2012 6:16 am
Remember, whenever you are asked to make an inference, it should always be a normal step and not a giant leap. This holds true for CR as well as inference questions of RCs. Make a logical and small inference, not a huge one.

Among all the choices, you should immediately eliminate those which say that all money comes from wealthy individuals.

Choice A makes a small inference and is correct.

Choice B is incorrect ( a huge inference)

Choice C is irrelevant.

Choice D is incorrect. ( a huge inference)

Choice E is not suggested by the author nor is it assumed.
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by bittu.0807 » Mon Apr 16, 2012 11:25 pm
Birottam Dutta wrote:
Choice B is incorrect ( a huge inference)


Choice D is incorrect. ( a huge inference)
Need more explanation on choice B and D. Is 'only' a strong word ?
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by [email protected] » Tue Apr 17, 2012 12:46 am
A proposed change to federal income tax laws would eliminate deductions from taxable income for donations a taxpayer has made to charitable and educational institutions. If this change were adopted, wealthy individuals would no longer be permitted such deductions. Therefore, many charitable and educational institutions would have to reduce services, and some would have to close their doors.
The argument above assumes which of the following?
(A) Without the incentives offered by federal income tax laws, at least some wealthy individuals would not donate as much money to charitable and educational institutions as they otherwise would have.
(B) Money contributed by individuals who make their donations because of provisions in the federal tax laws provides the only source of funding for many charitable and educational institutions.
(C) The primary reason for not adopting the proposed change in the federal income tax laws cited above is to protect wealthy individuals from having to pay higher taxes.
(D) Wealthy individuals who donate money to charitable and educational institutions are the only individuals who donate money to such institutions.
(E) Income tax laws should be changed to make donations to charitable and educational institutions the only permissible deductions from taxable income.


The OA is certainly between A and B.

Let us repeat the conclusion once more:

Therefore, many charitable and educational institutions would have to reduce services, and some would have to close their doors.

See the conclusion is not extreme. It is not saying that all the charitable and educational institutions will close down. If this would be the case then option B would be the most appropriate answer choice. But the conclusion says that some would survive but will have to reduce their services and some would completely get shut down.

Option B is not incorrect because it says an extreme case.

Whereas option A again is not an extreme statement. It says that many wealthy individuals will stop giving the money and some will reduce and some will continue to give
IF this happens then only some charitable institutions will survive...

Remember the GMAT question setters are very smart to trap you between the words some, many, most, rarely , mostly etc etc...

Also I would discuss the option D as many of you had problems:

Again an extreme situation just like option B. If this happens or if the option D is correct then all the charitable institutions and educational institutions will get shut down. But the conclusion does not say that...

The conclusion very clearly says that some shut down and some will reduce their services.

Always be cautious on words presented above.

Hope this post really helped...
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by David@VeritasPrep » Tue Apr 17, 2012 6:00 am
I saw that a couple of these postings treated this as an inference question. This is an assumption question. The stem reads "the argument above assumes which of the following?"

As an assumption question we need to identify the conclusion as well as the evidence and we need to find out the essential link between the two. If this link is removed the conclusion should fail.

The conclusion here is "Therefore, many charitable and educational institutions would have to reduce services, and some would have to close their doors."

What is the evidence for this? "If this change were adopted, wealthy individuals would no longer be permitted such deductions."

Okay so this is saying that without the tax deductions for wealthy individuals then the charities will have to reduce services or even close. Now find the link -- Why would they have to reduce services? -- well you reduce services when you do not have enough money.

So the assumption here is that without the tax deduction for wealthy individuals the charities will have less money. Answer choice A goes to this directly. It says that without the deductions "at least some wealthy individuals would not donate as much money to charitable and educational institutions as they otherwise would have."

Another good way to look at this one is to negate the answer choice to see what happens to the conclusion when the assumption is taken away. If we negate choice A we get "NO wealthy individuals will donate less money to charitable institutions (without the tax deduction). In other words the lack of the tax deduction would have no impact on funding. Because the negated answer choice undermines the conclusion we can see that choice A is essential.

Looking at choice B, we can see that we do not need the contributions of the wealthy to be "the only source of funding." If we negate this it just says that the wealthy are NOT the only source of funding. But we do not need the wealthy to be the only source of funding, we just need them to donate less without the tax deduction.

And choice D "Wealthy individuals who donate money to charitable and educational institutions are the only individuals who donate money to such institutions" is very much the same as B. Do we really need to have these wealthy individuals be the only ones to donate? If we negate this it says that they are not the only individuals and that is not a problem, we do not need them to be the only ones. We just need for the wealthy to donate less without the tax break.

Treat this as an assumption question, break down the conclusion and the evidence and you will have it.
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by karthikpandian19 » Wed Jun 06, 2012 6:43 pm
Thanks for your explanation
[email protected] wrote:A proposed change to federal income tax laws would eliminate deductions from taxable income for donations a taxpayer has made to charitable and educational institutions. If this change were adopted, wealthy individuals would no longer be permitted such deductions. Therefore, many charitable and educational institutions would have to reduce services, and some would have to close their doors.
The argument above assumes which of the following?
(A) Without the incentives offered by federal income tax laws, at least some wealthy individuals would not donate as much money to charitable and educational institutions as they otherwise would have.
(B) Money contributed by individuals who make their donations because of provisions in the federal tax laws provides the only source of funding for many charitable and educational institutions.
(C) The primary reason for not adopting the proposed change in the federal income tax laws cited above is to protect wealthy individuals from having to pay higher taxes.
(D) Wealthy individuals who donate money to charitable and educational institutions are the only individuals who donate money to such institutions.
(E) Income tax laws should be changed to make donations to charitable and educational institutions the only permissible deductions from taxable income.


The OA is certainly between A and B.

Let us repeat the conclusion once more:

Therefore, many charitable and educational institutions would have to reduce services, and some would have to close their doors.

See the conclusion is not extreme. It is not saying that all the charitable and educational institutions will close down. If this would be the case then option B would be the most appropriate answer choice. But the conclusion says that some would survive but will have to reduce their services and some would completely get shut down.

Option B is not incorrect because it says an extreme case.

Whereas option A again is not an extreme statement. It says that many wealthy individuals will stop giving the money and some will reduce and some will continue to give
IF this happens then only some charitable institutions will survive...

Remember the GMAT question setters are very smart to trap you between the words some, many, most, rarely , mostly etc etc...

Also I would discuss the option D as many of you had problems:

Again an extreme situation just like option B. If this happens or if the option D is correct then all the charitable institutions and educational institutions will get shut down. But the conclusion does not say that...

The conclusion very clearly says that some shut down and some will reduce their services.

Always be cautious on words presented above.

Hope this post really helped...
Regards,
Karthik
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