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#4- When deciding where to locate or relocate, businesses

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I had a hard time with this question. I chose E since i wasn't happy with the other choices. In ans choice. perhaps businesses have to act on their suggestions and move out when they do not get tax reductions. Hence, they are moving out.

How does B explain the discrepancy?


- Arindom
Adam Tyson
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Answer E here would be much better if it said something like "businesses are TYPICALLY ABLE to obtain tax reductions", which would make the higher tax rate less of a concern. As it is, the answer only says they sometimes TRY to get a reduction. Do they ever succeed? How often do they try?

What answer B does is help show that a negative in one category (tax rates) might be offset by a positive in another area (education or services), balancing the scales in a way that makes the negative more acceptable. That would help to explain why tax rates, although just as important as access to markets, would be less likely to impact the ultimate decision of where to locate. Think of it as averaging, and not unlike the situation many LSAT students are facing - some law schools may claim that GPA and LSAT are of equal importance in determining admissions, but a high LSAT could offset a low GPA.

Hope that helps! Good luck in your continued studies.
Adam M. Tyson
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