Tourists have long complained that hotel accommodations in Midville are too expensive. Starting last year, the city council, hoping to...
GMAT Critical Reasoning : (CR) Questions
Tourists have long complained that hotel accommodations in Midville are too expensive. Starting last year, the city council, hoping to attract more tourists, lowered the hotel tax rate to 5 percent of room charges. By the end of last year, Midville had taken in no less money from hotel taxes than it did the year before, so an examination of the hotel records will show that more tourists stayed in city hotels last year than the year before.
Which of the following is an assumption on which the argument depends?
Passage Analysis:
| Text from Passage | Analysis |
| Tourists have long complained that hotel accommodations in Midville are too expensive. |
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| Starting last year, the city council, hoping to attract more tourists, lowered the hotel tax rate to 5 percent of room charges. |
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| By the end of last year, Midville had taken in no less money from hotel taxes than it did the year before |
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| so an examination of the hotel records will show that more tourists stayed in city hotels last year than the year before. |
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Argument Flow:
We start with a problem (expensive hotels), then see the city's solution (lower tax rates), followed by evidence about tax revenue staying the same, which leads to a conclusion about increased tourist numbers.
Main Conclusion:
Hotel records will show that more tourists stayed in Midville last year than the year before.
Logical Structure:
The argument assumes that if tax revenue stayed the same despite lower tax rates, then there must have been more hotel stays to generate that same revenue. This relies on the assumption that hotel room prices didn't change, because if prices went up, the same number of tourists could generate the same tax revenue even with lower tax rates.
Prethinking:
Question type:
Assumption - We need to identify what must be true for the conclusion to hold. The author concludes that more tourists stayed in hotels based on the fact that tax revenue didn't decrease despite a lower tax rate.
Precision of Claims
The argument involves precise quantity comparisons: tax rate decreased to \(5\%\), tax revenue stayed the same or increased, and the conclusion claims MORE tourists stayed in hotels. We need assumptions that make this mathematical relationship work.
Strategy
For assumption questions, we identify ways the conclusion could be falsified while respecting the given facts. The logic is: Lower tax rate + Same/higher revenue = More tourists. We need to find what must be true for this math to work out correctly.
This choice suggests tourists were aware of the tax reduction. However, the argument doesn't depend on tourist awareness. The tax reduction would affect hotel prices regardless of whether tourists knew about it, and the conclusion about more tourists staying is based on tax revenue data, not on tourist knowledge. This is not an assumption the argument requires.
This choice compares Midville's hotel prices to other cities. While this might explain why more tourists came, the argument's conclusion is based solely on the relationship between tax rates and tax revenue within Midville itself. The argument doesn't need to assume anything about how Midville's prices compare to other cities for its internal logic to work.
This is the correct assumption. The argument concludes that more tourists stayed based on the fact that tax revenue remained the same despite lower tax rates. But if tourists stayed longer on average last year, then the same number of tourists (or even fewer) could generate the same tax revenue by booking more room-nights. For the conclusion that 'more tourists' caused the sustained revenue to be valid, we must assume that individual stay lengths didn't increase to account for the revenue.
This choice about increased publicity efforts might explain why more tourists came, but the argument doesn't depend on this assumption. The conclusion is drawn from tax revenue data alone, and the logic connecting tax rates to tourist numbers doesn't require any assumptions about marketing efforts.
This choice about tourist spending on meals versus accommodations is irrelevant to the argument. The conclusion is based on hotel tax revenue, which only reflects room charges, not meal expenses. The argument doesn't need to assume anything about tourists' meal spending patterns.