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A state electricity regulator proposes to meet the cost of free supply to the state's farm pump-sets by a surcharge on the state's industrial consumers, arguing that the state as a whole would gain, since the value of the additional crop raised would exceed the surcharge collected. Which of the following is an assumption on which the regulator's argument depends?

Competition practiceLogical / Critical
  • AThat a gain to the state taken as a whole settles the question, although the surcharge falls on one body of consumers and the additional crop is raised by another
  • BThat the state's farm pump-sets are used for raising crops and for nothing else
  • CThat the industrial consumers on whom the surcharge would fall draw their supply from the same network as the farm pump-sets
  • DThat the value of the additional crop can be arrived at exactly

Step-by-Step Solution

The regulator has one premise — the crop is worth more than the surcharge — and one conclusion, that the surcharge should be levied. The premise concerns a total and the conclusion concerns a charge on named people who will never see the crop, so a bridge is needed, and the bridge is that the total is what counts even where payer and gainer are different persons. Deny it and the argument is finished. That pump-sets are used for nothing but crops would tighten the estimate of the gain without touching the step from total to charge. Whether the two classes of consumer share a network is a technical fact of no bearing on who ought to pay. And exactness in valuing the crop would make the premise firmer; the regulator's premise, however, is already granted, and it is the passage from it that needs support.
Answer: A) That a gain to the state taken as a whole settles the question, although the surcharge falls on one body of consumers and the additional crop is raised by another

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