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Statement and Assumption - Verbal and Reasoning

Directions to SolveIn each question below is given a statement followed by two assumptions numbered I and II. You have to consider the statement and the following assumptions and decide which of the assumptions is implicit in the statement.Give answer
  • (A) If only assumption I is implicit
  • (B) If only assumption II is implicit
  • (C) If either I or II is implicit
  • (D) If neither I nor II is implicit
  • (E) If both I and II are implicit.
Q1:

Statement: The Union Government has decided to withdraw existing tax relief on various small savings schemes in a phased manner to augment its tax collection. Assumptions:
  1. People may still continue to keep money in small savings schemes and also pay taxes.
  2. The total tax collection may increase substantially.

A Only assumption I is implicit

B Only assumption II is implicit

C Either I or II is implicit

D Neither I nor II is implicit

E Both I and II are implicit

ANS:E - Both I and II are implicit

Explanation: The statement mentions that withdrawing tax relief on small savings schemes would help increase tax collection. This implies that the government would then earn tax on income derived from small savings schemes. So, I is implicit. Besides, II follows directly from the statement and so it is also implicit.