In the past, every ten-percentage-point increase in cigarette prices in the country of Coponia has decreased per capita sales of cigarettes by four percent. Coponia is about to raise taxes on cigarettes by 9 cents per pack. The average price of cigarettes in Coponia is and has been for more than a year 90 cents per pack. So the tax hike stands an excellent chance of reducing per capita sales of cigarettes by four percent.
Which of the following is an assumption on which the argument depends?
Q25: In 1983 Argonia’s currency, the argon, underwent a reduction in value relative to the world’s strongest currencies.This reduction resulted in a significant increase in Argonia’s exports over 1982 levels.In 1987 a similar reduction in the value of the argon led to another increase in Argonia’s exports.Faced with the need to increase exports yet again, Argonia’s finance minister has proposed another reduction in the value of the argon.
Which of the following, if true, most strongly supports the prediction that the finance minister’s plan will not result in a significant increase in Argonia’s exports next year?
The value of the argon rose sharply last year against the world’s strongest currencies.
In 1988 the argon lost a small amount of its value, and Argonian exports rose slightly in 1989.
The value of Argonia’s exports was lower last year than it was the year before.
All of Argonia’s export products are made by factories that were operating at full capacity last year, and new factories would take years to build.
Reductions in the value of the argon have almost always led to significant reductions in the amount of goods and services that Argonians purchase from abroad.
Q38: In the past, every ten-percentage-point increase in cigarette prices in the country of Coponia has decreased per capita sales of cigarettes by four percent.Coponia is about to raise taxes on cigarettes by 9 cents per pack.The average price of cigarettes in Coponia is and has been for more than a year 90 cents per pack.So the tax hike stands an excellent chance of reducing per capita sales of cigarettes by four percent.
Which of the following is an assumption on which the argument depends?
Tobacco companies are unlikely to reduce their profit per pack of cigarettes to avoid an increase in the cost per pack to consumers in Coponia.
Previous increases in cigarette prices in Coponia have generally been due to increases in taxes on cigarettes.
Any decrease in per capita sales of cigarettes in Coponia will result mainly from an increase in the number of people who quit smoking entirely.
At present, the price of a pack of cigarettes in Coponia includes taxes that amount to less than ten percent of the total selling price.
The number of people in Coponia who smoke cigarettes has remained relatively constant for the past several years.