Critical Reasoning

loki.gmat wrote:A - rate of inflation - out of scope.
B - tax rates - out of scope.
C - even if the spending, during verdant's term in office, increased steadily every year, this doesnot indicate whether the spending was more or less compared to the previous governor's term.

i m confused between D n E.

but somehow feel E is better.


Thanks!

loki.gmat wrote:in India, right now the rate of inflation is 11.05%. the highest is last 13yrs.
following r the main reasons, as cited by the experts:
1)high import oil prices.
2)big farm loan waiver by the government (close to Rs71000 crore - an election gimmick).
3)high GDP growth.
4)depreciting rupee .........etc.
so if the inflation is down, in some cases it will allow the government to have extra funds to spend on the states, if it wants to.in such cases A will actually strengthen the argument.

so u see it depends upon what the scenario is. there is nothing mentioned in the passage about the rate of inflation.
hence A is out of scope.


Thanks!

durgesh79 wrote: 3)high GDP growth.

BUT, you forgot to mention a very important reason .... India's growth .... In any economy one of the main reasons for hight inflation is high growth rate..)

john1234 wrote:While Governor Verdant has been in office,the state's budget has increased by an average of 6 percent each year.While the previous governor was in office,the state's budget increased by an average of 11.5 percent each year.Obviously,the austere budget during Governor Verdant's term have caused the slowdown in the growth in state spending.

Which of the following,if true,would most seriously weaken the conclusion drawn above?
a) The rate of inflation in the state average 10 percent each year during the pervious governor's term in office and 3 percent each year during Verdant's term.
b) Both federal and state income tax rates have been lowered considerably during Verdant's term in office.
c) In each year of Verdant's term in office, the state's budget has shown some increase in spending over previous year.
d)During Verdant's term in office,the state has either discontinued or begun to charge private citizen for numerous services that the state offered free to citizens during the previous governor's term.
e)During the previous governor's term in office, the state introduced several so-called "austerity" budgets intended to reduce the growth in state spending.

Please how do you go about this?

Wizardry wrote:

john1234 wrote:While Governor Verdant has been in office,the state's budget has increased by an average of 6 percent each year.While the previous governor was in office,the state's budget increased by an average of 11.5 percent each year.Obviously,the austere budget during Governor Verdant's term have caused the slowdown in the growth in state spending.

Which of the following,if true,would most seriously weaken the conclusion drawn above?
a) The rate of inflation in the state average 10 percent each year during the pervious governor's term in office and 3 percent each year during Verdant's term.
b) Both federal and state income tax rates have been lowered considerably during Verdant's term in office.
c) In each year of Verdant's term in office, the state's budget has shown some increase in spending over previous year.
d)During Verdant's term in office,the state has either discontinued or begun to charge private citizen for numerous services that the state offered free to citizens during the previous governor's term.
e)During the previous governor's term in office, the state introduced several so-called "austerity" budgets intended to reduce the growth in state spending.

Please how do you go about this?

The question is a very technical unlikely to be asked on GMAT ; reasons are as below :

We are being asked about slowdown in growth of state spending; therefore, we need to more focused on %
a) Option tells about inflation rate was dropped from 10% to 3% ( absolute decrease of 7%), keeping all factor equal and considering the fact that inflation index rightly represents government spending, then this option might sounds right, say spending decreased from 11.5% to 6% , absolute decrease of 5.5% , this imply that overall spending in absolute % term may increased by 1.5% . And therefore 1.5% growth over previous budgets and consistent over the governor Verdent's term.

In actual situation, the government spending may differ . May be just consumer products have increased or decreased in price not the infrastructure related products, all over effect will still be net decrease in inflation, again that depends on what all is included in defining consumer price index and inflation index.


b) This may be cause the Governor to decrease the budget, since revenue for government decreases and hence the spending , but here we are talking of absolute %, that is slowdown in growth in government spending. therefore cannot come to a definite conclusion . but a factor cannot be neglected.

c) Even if the option says what is desired as a right answer but the growth rate mentioned are 11.5% and 6% the differ in and strengthen the conclusion.

d) option says the government started charging citizen , reflects that government is increasing its revenue by doing that but this options say nothing about slowdown of government spending .

e) Option does states the fact, which might let us conclude easily what is desired but pay attention to what is required ,i.e. from 11.5% to 6% , we need to add the other cause that has led to slowdown in growth of government spending, if previous governor have already done that , then what are other factor that brought growth rate from 11.5% to 6% will be our answer ....

i hope everyone enjoy the reasoning...... do comment ... best of luck; therefore A should be the answer , from given options....