LR Question 21 Explanation
QUESTION TEXT: Finance minister: The World Bank’s “Doing Business” report ranks…
QUESTION TYPE: Argument Evaluation
CONCLUSION: Our government’s “Doing Business” ranking will probably improve.
REASONING: The rankings assess the difficulty of paying taxes and complying with regulations. We have made paying taxes easier for small and midsized businesses since the last ranking.
ANALYSIS: You may have noticed that there’s something missing here. The rankings assess two things: paying taxes and complying with regulations. The minister addresses paying taxes, but only for small and midsized businesses. We don’t know about large businesses – the government may have made taxes a nightmare for them! That information would certainly help.
Secondly, the minister never addresses complying with regulations. If the government made it harder to comply with regulations, their ranking might not improve. It would also help to know this information. The correct answer will likely address one of these two things.
___________
- The rankings don’t care how often new businesses are formed. They only assess how easy it is for an already-existing business.
- It doesn’t matter if compliance has increased. We need things overall to be easier. The answer to this question won’t help us.
- This tells us something we didn’t already know, but doesn’t help us evaluate the argument. Even if it’s hard to comply with regulations, it may be easier than last year. If so, the ranking will have increased.
- CORRECT. This information would really help. If we know what size business the “Doing Business” report uses, we can assess whether these tax changes actually matter for the report.
- It doesn’t matter who the minister was. The minister isn’t graded, the country and its regulations are graded.
Recap: The question begins with “Finance minister: The World Bank’s “Doing Business” report ranks”. It is a Argument Evaluation question. Learn how to master LSAT Evaluate questions on the LSAT Logical Reasoning question types page.
More Resources for Argument Evaluation Questions
- Intro Course lesson: This intro course lesson covers Argument Evaluation questions.
- Mastery Seminar lesson: This LR Mastery seminar lesson covers argument evaluation questions.
Hi, two questions, both tie in together to a degree:
1. for B, why doesn’t it matter if compliance increased? The prompt says “the World Bank assesses how difficult it is for a hypothetical business to comply…” Sure, this alone doesn’t guarantee it’s easier overall. But it certainly helps if paired with the question “Has compliance by non-small/medium businesses increased?”
2. Why does the business have to be as big as the hypothetical business? That would only matter if the report ranks compliance in regards to scale of size of business. Like, why does a large company compliance have more weight than a small/medium? It doesn’t say it in the prompt, and I don’t think it’s a fair enough assumption. If the report weighed each company evenly and just said “hypothetical business” because then size doesn’t matter (which makes even more sense), then D wouldn’t matter. Thus, since we don’t know this info, D doesn’t matter.
Hi! Good questions.
1. The core issue is difficulty, not behavior. The World Bank’s rankings assess how hard it is to comply with regulations and pay taxes, not whether more businesses are managing to do it. Compliance rates can go up for reasons unrelated to ease (stronger enforcement, higher penalties, etc). So even if compliance increased, that doesn’t necessarily mean the process became easier, which is what the rankings actually measure.
2. The prompt tells us that the World Bank assesses how difficult it is for a hypothetical business to comply. If the government only made tax filing easier for businesses smaller than the hypothetical one, those changes wouldn’t impact the ranking, since the hypothetical business wouldn’t benefit.
You’re right that we don’t know for sure what size the hypothetical business is, but that’s exactly why this is a useful question to ask. It would clarify whether the government’s changes actually affect the kind of business used in the ranking. Without knowing that, we can’t reliably predict the ranking change. That’s why D directly helps evaluate the argument.
Hope this helps clarify! Let me know if you have any other questions.