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Statement: The government has introduced a new tax on luxury goods.
Inference:
I. The government is trying to raise revenue.
II. The government wants to discourage the purchase of luxury goods.
III. The government wants to promote the purchase of locally made goods.
  • a)
    If only I follows
  • b)
    If only II follows
  • c)
    If both I and II follow
  • d)
    If both II and III follow
Correct answer is option 'C'. Can you explain this answer?
Most Upvoted Answer
Statement: The government has introduced a new tax on luxury goods.Inf...
The statement mentions that the government has introduced a new tax on luxury goods. From this, it can be inferred that the government is trying to raise revenue through taxation. This leads to the inference that option I is correct. Furthermore, the government has introduced the tax on luxury goods, which indicates that it wants to discourage their purchase. Therefore, option II is also a possible inference from the statement. Option III is incorrect as there is no mention of the government wanting to promote the purchase of locally made goods in the statement.
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Statement: The government has introduced a new tax on luxury goods.Inf...
Understanding the Inference from the Statement
The statement indicates that the government has introduced a new tax on luxury goods. Let's analyze the provided inferences to understand why option 'C' is correct.
Inference I: The government is trying to raise revenue.
- Explanation: Introducing a tax is a common method for governments to increase their revenue. Taxing luxury goods typically targets higher-income individuals, thereby generating additional funds for public services and infrastructure. This inference logically follows from the statement.
Inference II: The government wants to discourage the purchase of luxury goods.
- Explanation: Taxing luxury items can serve as a deterrent, making these goods more expensive and potentially decreasing their consumption. This inference aligns with the intent of imposing a luxury tax, aiming to reduce the demand for such products. Thus, this inference also follows from the statement.
Inference III: The government wants to promote the purchase of locally made goods.
- Explanation: The introduction of a tax on luxury goods does not inherently suggest a promotion of locally made products. There is no direct correlation between taxing luxury items and encouraging local goods. Therefore, this inference does not necessarily follow from the statement.
Conclusion
Based on this analysis:
- I and II are valid inferences that stem from the government's action of taxing luxury goods.
- III is not a valid inference as it does not logically connect to the tax's purpose.
Thus, the correct answer is option 'C', as both I and II follow logically from the statement.
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