Q16 - Economist: A tax is effective

[alinanny]

For this type of question my confusion is that there are two necessary conditions that must be met for a tax to be effective and two necessary conditions for a tax to be ineffective.
For effective A and B
For ineffective not A and D.
So answer B has A and D so this doesn't make it ineffective.
answer C has D. So if not A then it's ineffective. Is B effective or we simply don't know based on what we know?
I see why C is correct but I just want to make sure that I understand this in the future.
For this type of answer to be correct we must find an answer that meets both conditions right?

[giladedelman]

Thanks for your post!

It sounds like you're on the right track, but you make one big mistake: we get sufficient conditions for effective and ineffective, not necessary ones. And these are what we might consider to be "compound conditions": we need 2 things in order to conclude effective and ineffective. So our conditional statements look like this:

raises revenue + burdens all/only those targeted --> effective

doesn't raise revenue + significant amount of money to enforce --> ineffective

Now, the correct answer does NOT have to obey both conditional statements. It just has to obey at least one of them.

(C) is correct because it obeys the second statement: no revenue increase + costs significant amount --> ineffective

(A) is incorrect because if it doesn't raise revenue, we are unable to conclude that it's effective.

(B) is out because, as you said, we have one half of the sufficient condition but not the other.

(D) is wrong for the same reason. We're missing revenue increase.

(E) is also missing one of the conditions for ineffectiveness.

You raise another important point: with each wrong answer, we simply don't know whether the tax is effective or ineffective or whatever. That's because we're missing part of the sufficient conditions given. But maybe there are other sufficient conditions out there! So with answer (B), for example, maybe the tax actually is ineffective, but we don't have enough information to make that judgment based on the principles given.

Does that help?

[natasha119]

raises revenue + burdens all/only those targeted --> effective

doesn't raise revenue + significant amount of money to enforce --> ineffective

I'm a little confused by this--if we take the contrapositive of the first statement-we get:
ineffective --> doesn't raise revenue or doesn't burden all/only those targeted.

I realize we are given a second conditional statement but why doesn't the contrapositive apply here?
By using the CP, I thought E would be correct since it doesn't raise the revenue, and that's all that would be needed based on the CP of the first statement.