Critical Reasoning

Can anyone provide an explanation of this CR question:


Two years ago, the government of Runagia increased by 20 percent the government-provided pensions paid to Rungians over 65. The aim of the increase was to stimulate the economy in the rural regions of the country, where most pension recipients live. Statistics, however, show that there has been no increase in economic activity in those regions since then, but that there has been noticeably more spending in urban areas.
Which of the following, if true, most helps to explain why the increase resulted in the unintended state of affairs described?
a) Until the pensions were increased, many Runagians over 65 in rural areas had been receiving support from their children who live in urban areas
b) The pensions were increased when the number of people below the poverty level in rural areas of Runagia reached an all-time high.
c) City-dwellers in Runagia rarely travel to rural regions of the country.
d) The Runagian postal system is so inefficient that it can take up to 3 weeks for pension checks to reach recipients in rural areas.
e) On average, the pensions were higher in rural than in urban areas before the increase.


(answer is D)

IMO A

If Runagians already received money from their children, they probably spend the same as before the increase in pension. So, there are no increase in spending in rural. At the same time, their children have no need to support their parents so they can spend more in urban.

Choice D is incorrect, as it requires another assumption that Runagians will come to spend in urban to spend as a result of delay of mail delivery.

we always prefer a choice that doesn't involve extra assumption.

Hope that helps!!

Agree with force5

Even if checks took two extra weeks, the timing impact would have long since dissipated. WE not only don't know that the pensioners are traveling to the city to spend, we don't know whether they have the option or receiving their pensions in the city. In fact, given the government objective, it is highly unlikely that checks would be sent anywhere other than to the rural addresses.

Imagine if you had been sending a few hundred dollars a month to your aged parents and suddenly they no longer need the money because they get a subsidy from the government. If you were very prudent you might start saving the money you had been sending, but most people are going to spend at least a portion of those freed-up funds on themselves.

Thanks! you guys are right. The answer is A, not D. Typo on my part. Great catch on your parts...THANKS!

A: Correct. This option tells us that most Runigians were able to fend themselves by getting support from their children. Thus they may be using the higher pension to save rather than consume. Even if they stop receiving the support from their children, they may consume. In both cases, whether they are receiving or not receiving children support, the level of consumption does not change.

B: This would actually lead to higher consumption. Opposite answer
C: Unrelated
D: So what? Even if pension reaches late, how does it impact consumption. There is no correlation between consumption and postal service.
E: So what?

I tried answering this question by asking myself 'so what'?

Cheers
TJ