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Most large retail stores hold sales in the month of January. The original idea of price reduction campaigns in January became popular when it was realized that sales or products would generally slow down following the Christmas rush, were it no for some incentive. The lack of demand could be solved by the simple solution of reducing prices. There is now an increasing tendency among major department stores in large urban centers to have their January sales being before Christmas, some time before the end of the calendar year. The idea behind this trend is to endeavor to sell the maximum amount of stock at a profit, even if that may not be at the maximum profit. Which of the following conclusions cannot be drawn from the above ?
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A. The incidence of early January sales results in the lower holdings of stocks with the corollary of lower stock holding costs.
B. Demand is a function of price; as you lower price, demand increases.
C. Major stores seem to think it makes sense to have to January sales campaigns pre-Christmas.
D. It is becoming less popular to star the January sales in the New Year.
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| 2 |
In the human body, platelets, promote blood clotting by clumping together. Aspirin has been found to prevent clotting by making platelets less sticky. Research has now shown that heart attacks and strokes caused by blood clots could be avoided by taking one aspirin a day. Statistics show that the incidence of second heart attacks Unfortunately, the drug has several unpleasant side effects, including nausea, gastric bleeding, and, in severe cases, shock. In children, it has been linked to Reye Syndrome, a rare, but occasionally fatal, childhood illness. One balance, however, for men aged 40 and over, an aspirin a day may present an excellent prophylactic measure for a disease that affects 1.5 million Americans yearly and claims the lives of about 540,000. Which of the following conclusions can most properly be drawn from the information above ?
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A. All people should take an aspirin a day to prevent heart attacks.
B. Painkillers prevent heart attacks.
C. Smokers can safely continue smoking, provided that they take at least one aspirin a day.
D. The majority of people suffering second subsequent cardiac arrests could have been saved by taking an aspirin a day.
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| 3 |
Many countries are facing a potential crisis in 20 to 30 years time. The ratio of pensioners to workers will be changing drastically with a declining birth rate, with more lengthy education of the young, and with a reduced working life. In general, the number of people paying into pension schemes is decreasing all the time. Meanwhile, with increased health care and living standards, more people are living long enough to draw their pension funds. A controversial solution to this problem has been proposed in Germany-changing the age of retirement, for both men and women, from the current qualifying age of 63 for men and 60 for women. A radical, but socially acceptable, solution to this problem must be found. If this is not done, it is predicted that by the year 2050, one person in three will be 65 or over and the projected work force will be unable to support pensions. Assuming the following were all socially acceptable, which one would not improve the situation in the future ?
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A. Lower the retirement age.
B. Decrease the school-leaving age.
C. Impose larger contributions on employees and employers.
D. Cut pensions in half.
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| 4 |
Ali is a terrible driver. He has had at least five traffic violations, int he past year. Which of the following can be said about the above claim ?
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A. This is an example of an argument that is directed against the source of the claim rather than the claim itself.
B. The statement is fallacious because it contains an illegitimate appeal to authority.
C. The above argument obtains its strength from a similarity of two compared situations.
D. The argument is built upon an assumption that is not stated but rather is concealed.
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| 5 |
The director of the customs service suggested that customs taxes on automobiles not be reduced as planned by the government because of the high incidence of traffic accidents last year. Which of the above statements weakens the argument above ? 1. Although the traffic accident rate last year was high, it was not appreciably higher than previous years and anyway, compulsory insurance covered most physical damage to automobiles and property. 2. A Commerce Department report showed that the demand for automobiles was highly inelastic. That is, as dealers lowered their prices, sales did not increase appreciably. 3. A study by the Economics Department at Classics University found that most traffic accidents had been caused by human error although it also concluded that an inadequate road network contributed to at least 40 percent of passenger injuries.
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A. I, but not II and not III.
B. II, but not I and not III.
C. I and III, but not II.
D. II and III, but not I.
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| 6 |
A local garbage disposal company increased its profitability even though it reduced its prices in order to attract new customers. This was made possible through the use of automated trucks, thereby reducing the number of workers needed per truck. The company also switched from a concentration on household hauling to a concentration on commercial hauling. As a result of its experience, company management planned to replace all their old trucks and increase the overall size of the truck fleet, doubling hauling capacity. The company's plan as outlined above, takes into consideration each of the following except:
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A. Commercial clients have more potential than household customers.
B. The demand for garbage removal services is sensitive to price.
C. Demand for garbage removal services would increase in the future.
D. Doubling of capacity would not encessitate; a substantial increase in the work force.
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| 7 |
Farmers in the North have observed that heavy frost is usually preceded by a full moon somehow generates the frost. Which of the following, if true, would weaken the farmers conviction ?
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A. The temperature must fall below 10 degrees Celsius (50 degrees Fahrenheit) for frost to occur.
B. Absence of a cloud cover cools the ground which causes frost.
C. Farmers are superstitious.
D. No one has proven that the moon causes frost.
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| 8 |
In a world of many trading countries, the trade between two countries need not be balanced for the trade of each to be in global balance. Differing demands and productive capabilities among countries will cause a specific country to have trade deficits with some countries and surpluses with other countries. Which of the following conclusions best summarizes the passage above ?
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A. A country trade will always be in balance even though it runs a deficit with a single country.
B. A country trade deficits and surpluses with other countries always balance out.
C. A country global trade balance is a sign of strength or weakness.
D. Countries should not be concerned if they have trade deficits because they will balance out in the long run.
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| 9 |
Forty years after African colonies began emerging as nations, modern loyalties still often go first to the tribe. From Angola to Ethiopia, ethnic hatred has forced hundreds of thousands of people to flee their homes, making Africa the continent with the world's largest number of refugees. Which of the following statements best summarizes the above ?
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A. Africa is best characterized ethnic fractionalization.
B. Angola and Ethiopia have the worst record of inter ethnic strife in Africa.
C. Continued warfare has made Africa a nation of refugees.
D. Africa is best characterized as a federation of many states.
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| 10 |
The President lobbied for passage of his new trade bill which would liberalize trade with industrialized countries such as Japan, members of the European Community, and Canad. Each of the following, if true, could account for the above, except:
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A. The President is up for re-election and needs to show results.
B. Labour unions have petitioned the President to provide more local jobs.
C. The trade agreement could bring a quid pro quo on pending negotiations.
D. Economists claimed that the passage of the bill would increase the country trade deficit.
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