PrepTest 150, Section 3, Question 21
Finance minister: The World Bank's “Doing Business” report(63 more words not shown)
The answer to which one(13 more words not shown)
- AIf the finance(22 more words not shown)
- BHas compliance with(13 more words not shown)
- CFor small and(19 more words not shown)
- DIs what the(20 more words not shown)
- EWas the finance(11 more words not shown)
Reading the argument
What size business does the report use? Making taxes easier for small and midsized businesses helps the ranking only if the hypothetical business receives that benefit. If the report models a large company whose filing rules haven't changed, the minister's evidence misses the business being measured.
And what are other countries doing? A ranking compares countries. This country could make things easier and still fall behind countries that improve more.
What we’re looking for
Either question would help us evaluate the prediction.
Working the answers
- A
The ranking measures ease of doing business, not how many businesses are created. Easier rules might encourage new firms, but we don't need to know whether they do in order to judge how difficult the report's hypothetical firm's tasks have become.
- B
Following the tax laws isn't the same as finding them easy to follow. Businesses might already have complied despite considerable difficulty, or might continue to disregard rules that became simpler. The report measures the difficulty of compliance, so a change in the number actually complying doesn't directly answer our question.
- C
This compares two burdens inside the country: tax filing and other regulations. Taxes could be the larger burden or the smaller one, and simplifying them could still help the relevant business. C doesn't establish whether that business gets the benefit, nor does it tell us how the country's overall difficulty compares with other countries'.
- DCorrect
This tests the first concern. If the hypothetical business is larger than the minister's midsized category, the cited changes for small and midsized firms may leave its tax filing untouched. In that case, those changes don't give us the claimed reason to expect a better ranking.
If the answer is no, the model business falls within the size range the minister says benefited. Now the simplification is relevant to what the report measures. That still doesn't settle what other countries have done, but an evaluation answer doesn't have to resolve every uncertainty. The two responses to D meaningfully change how much the minister's evidence supports the prediction.
- E
The minister's tenure doesn't tell us whether business conditions improved or whether the report measures the businesses affected. A newer minister could describe a real improvement, and a long-serving one could make an unsupported prediction. We need information about the change and the ranking, not who held the office last time.
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