swati007 wrote:
@pqhai,
Hi,
why option D is incorrect?
if X->Y, then assumption could be that Y --x-->X(Y will not cause X)
or A->Y(A will cause Y)
In option D, aint we trying to do this --it assumes other cause (interest rate) as the reason of bank failures?
Someone, Please explain
Hi,
why option D is incorrect?
if X->Y, then assumption could be that Y --x-->X(Y will not cause X)
or A->Y(A will cause Y)
In option D, aint we trying to do this --it assumes other cause (interest rate) as the reason of bank failures?
Someone, Please explain
Hi swati007
I'm glad to help.
GENERAL THEORY
First of all, to get a correct answer in assumption question, the first and most important thing is determine conclusions correctly. Please note that, there is a lot of information in an argument, but you just need to attack the question/assumption you're being asked. That makes GMAT more difficult than normal tests.
Back to this question, the argument uses a famous critical thinking logic "Conditional Reasoning".
The form is:
(1) If A, then B
(2) A
(3) Conclusion: Therefore B
Apply to this question:
(1) If depositors were more selective, then banks would need to be secure in order to compete for depositors' money
(2)..............?????
(3) Therefore, banks would need to be secure in order to compete for depositors' money
Now you see the conclusion more clearly ==> The missing part (2) is the assumption. What is (2)? You can apply the form above, and get the assumption very easy: depositors were able to be more selective in determining which bank is secure.
WHY D IS WRONG?
D say: The difference in the interest rates paid to depositors by different banks is not a significant factor in bank failures
Ask yourself: is this the assumption of the conclusion "banks would need to be secure in order to compete for depositors' money". Not at all. The main point of the conclusion is "need more sure to compete for depositors' money". But D talks about "the factor of bank failures". They don't match at any point.
TAKEAWAY:
In Assumption questions, determine the correct conclusions is KEY
There is a lot of info in the argument, Just focus on what you are being asked.
Hope that helps.
Regards.