Leveraged Buyout

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Leveraged Buyout

by fighting_cax » Wed Jun 10, 2009 2:35 am
In a leveraged buyout, investors borrow huge sums of money to buy companies, hoping to pay off the debt by using the company’s earnings and to profit richly by the later resale of the companies or their divisions.
(A) by using the company’s earnings and to profit
(B) by using the companies’ earnings and by profiting
(C) using the companies’ earnings and profiting
(D) with the company’s earnings, profiting
(E) with the companies’ earnings and to profit

OA is E

Please explain.

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by priyank12 » Wed Jun 10, 2009 3:52 am
borrow huge sums of money to buy companies
so to make it parallel we need to use "to profit"

so we are left with A and E

we need to use companies because in sentence companies has been reffered before and not company

so we are left with E

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by 2010gmat » Wed Jun 10, 2009 3:56 am
you have caught the problem right ..i.e. parallelism but i think the parallel parts shud be

hoping to pay off.... and to profit

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by perfectstranger » Wed Jun 10, 2009 11:21 am
b)by using the companies’ earnings and by profiting

What's wrong with this one ? by using ..... by profiting . Paralel structure is established.

.....huge sums of money to buy companies, hoping to pay off the debt by using the company’s earnings and to profit richly .

Here paralelism cannot be established with ''with the companies’ earnings and to profit '' and to pay off . I thought that paralelism constructed here by with X and Y structure where X and Y are paralel. However, th companies' earnings and to profit is not paralel.

Could someone provide an explanation?

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by schumi_gmat » Wed Jun 10, 2009 11:33 am
b)by using the companies’ earnings and by profiting

What's wrong with this one ? by using ..... by profiting . Paralel structure is established.

.....huge sums of money to buy companies, hoping to pay off the debt by using the company’s earnings and to profit richly .

Here paralelism cannot be established with ''with the companies’ earnings and to profit '' and to pay off . I thought that paralelism constructed here by with X and Y structure where X and Y are paralel. However, th companies' earnings and to profit is not paralel.

Could someone provide an explanation?

by profiting is awkward use of participle.
secondly, it changes the meaning. When you use "by profiting" it sounds like you are paying off debt by using....and by profiting.....
Where as paying off debt and to profit are 2 different events.

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by SanjeevK » Wed Jun 10, 2009 11:33 am
The debt is paid off with the companies’ earnings and not using the companies's earnings.
Also here the parallelism has to be between "to pay off" and "to profit".

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Re: Leveraged Buyout

by real2008 » Wed Jun 10, 2009 12:02 pm
fighting_cax wrote:In a leveraged buyout, investors borrow huge sums of money to buy companies, hoping to pay off the debt by using the company’s earnings and to profit richly by the later resale of the companies or their divisions.
(A) by using the company’s earnings and to profit
(B) by using the companies’ earnings and by profiting
(C) using the companies’ earnings and profiting
(D) with the company’s earnings, profiting
(E) with the companies’ earnings and to profit

OA is E

Please explain.
(A) by using the company’s earnings and to profit: "companies' earnings" is correct as the main sentence contains "companies".
(B) by using the companies’ earnings and by profiting: parallelism error (To profit is correct rather than by profiting)
(C) using the companies’ earnings and profiting: preposition at the beginning missing and 'profiting' is wrong
(D) with the company’s earnings, profiting: errors are evident from previous explanations
(E) with the companies’ earnings and to profit: correct