Self-study
A new tax law aimed at encouraging the reforestation of cleared land in order to increase the amount of forested land in a particular region offers lumber companies tax incentives for each unit of cleared land they reforest. ███ ██████ ███████ ███ ███████████ ███████ ███ ███ █████████ ██ ██████████ █ █████ █████ ██ ███████ ████ ██ ███ ██████ ███ ███████████ ███ ███ ███████ ████ ███ ███ ████████ ██ ████████ █ ██████ █████ ██ ████ ██ ███ ███████ █ █████ ████ ██ ███ ███████ ██ ████ ██ █████████ ████████
Summary
This new tax law intends to increase the amount of forested land in the region.
The law offers tax incentives for lumber companies for each unit of cleared land that they reforest.
A company purchased a large area of already cleared land and reforested it in order to receive the tax incentives.
The company paid for this purchase by clearing a larger tract of land in the region that it had originally planned to hold in long-term reserve.
Notable Valid Inferences
The tax law incentivized the lumber company to clear more land than it otherwise would have. In order to buy and reforest a large tract of cleared land, the company cleared an even larger tract of land that it had intended to hold in reserve. This is a net-loss in forested area.
14.
If the statements above are █████ █████ ███ ██ ███ █████████ ████ ██ ████ █████ ███ ███ ███ ████
a
It is a ███████ ██ ███████████ ███ █████████████ ██ ███████ ████ ██ ███ ███████
This could be false. This is too broad. The stimulus only discusses the actions of one company; we don’t know enough to say whether the new law was a failure overall. Further, in this case, the law actually did encourage the company to reforest a large tract of cleared land.
b
It will have ██ █████████ ██████ ██ ███ ██████ ██ ████████ ████ ██ ███ ███████
This could be false. Even in the example with the company, we can see that the law had an effect on the amount of forested land in the region (a net loss).
c
It will ultimately █████ ██████ █████████ ██ █████ █████ ██ █████████████ ██ ████ ████ ██ ████ ███████ ██ ███ ███████
This could be false. Since we only know about the actions of one company, we can’t make any definitive claims about what the ultimate result of the new law will be.
d
It can provide █ ██████████ ███ █████████ ██ ███ ██ █ ██████ ████████ ██ ███ ███████ ██ ███ ███ █████ ██████ █████████ ██ ███ ███ ███████████
This must be true. The law encouraged the company to act in a way that resulted in a net loss of forested area, even though the intent of the law was to increase the amount of forested land.
e
It will provide ██████ █████████ ████ █ ███ █████████ ████ ████ ██████████ ██ ███████████ ███ █ ███████ ████████ ██ ███ ██████ ██ ██████ ███████ ██ ███ ███████
This could be false. Similar to (C), since we only have the description of the actions of one company, we can’t make any claims about what the overall results of the law will be.