English and Logical Reasoning Prep GuideEnglishParagraph Organization
Directions: In each of the following questions a short passage is given with one of the lines in the passage missing and represented by a blank. Select the best out of the five answer choices given, to make the passage complete and coherent (coherent means logically complete and sound). Out of all the taxes, corporate taxes imposed on multinational corporations (MNCs) are major sources of revenue for most economies.
Options
- ABoth historical and contemporary perceptions of tax have characterised it as a necessary extraction, a penalty
- BDespite some major limitations, various fiscal jurisdictions have already gone ahead with signing such agreeme
- CTax evasion is where a seepage in the boundaries set by fiscal laws is discovered, and which is then used to e
- DOnce riddled with incidents of double taxation, the MNCs have now outsmarted the system and have moved into an
Correct answer
D. Once riddled with incidents of double taxation, the MNCs have now outsmarted the system and have moved into an
Step-by-step solution
If we read the given paragraph carefully, we can infer that it talks about how MNCs are evading taxes. The sentence following the blank points towards some ‘creative accounting techniques’ that MNCs use to avoid paying taxes to the government. Out of the given options, only E fits the blank appropriately as it mentions how MNCs have ‘outsmarted’ the system. The verb ‘outsmarted’ clearly links to the chain of thoughts and complements the idea being discussed. Option E is hence the