GMAT Essays: Avoid Fallacy Fallacy
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Scene: a busy street. A businessman in a suit and tie stands before a cloth covered table. A fortune teller sits on the other side of the table, peering into a crystal ball.
Fortune teller: “I see danger in your future, you are at grave risk! For $20, I shall peer into this crystal ball and tell you how disaster can be avoided!”
Businessman: “What a load of $&#%! Fortune telling is nonsense, and there is no way you could see my future through the crystal ball. I’m certain I’m in no danger whatsoever!”
Businessman walks across the street without looking and is run over by an ice cream truck.
So, GMAT students, was the fortune teller right? Was she genuinely psychic? Did her crystal ball receive emanations from the spirits predicting the future?
Of course not. Scientific consensus is that psychic powers don’t exist, and even the superstitious must acknowledge plastromancy as the superior form of divination.
But the businessman made a critical mistake: he made what’s known as the “Fallacy Fallacy,” mistaking a flawed argument for a false conclusion. Sure, the crystal-ball reading was a foolish basis for arguments about danger. But as the old saying goes, a stopped clock is right twice a day. Anyone standing on a busy city street is at low-to-moderate risk. Although the fortune teller has no justification for her claim, she happened to be right that the businessman was at risk through accident of location. And the businessman, foolishly assuming himself to be perfectly safe, compounded his risk through his own poor logic.
When you see the Analytical Writing Assessment (which remains on the New GMAT), bear in mind this example . The argument you are given will invariably be terrible, but you can’t dismiss the conclusion solely on that basis. Moreover, the GMAT essay prompts will generally refer to fictional people and business in made-up locations. That means there are countless unknowns and hypotheticals that make definitive judgment impossible.
To plan your response to the AWA, consider the businessman. His proper response would be, “Your crystal ball isn’t persuasive. If I’m at risk, it’s because of factors you can’t possibly be aware of. And if I do get hit by a car, it won’t be because of your crystal ball. Now, excuse me, I need to wait for a walk sign.” And so, when analyzing an argument on the GMAT, you should always conclude the same way. Make clear that the author could be right—he could be lucky, a confluence of factors could make his plan work or bring his prediction to fruition. But his evidence will invariably be lacking, and his logic will certainly rely on improbable assumptions. Go on to explain that he must be lucky for his conclusion to be valid, because luck is the only thing he has going for him.
Question of the day:
Our company’s chief financial advisor is outstanding. Of the ten stocks she invested company funds in over the past year, eight have increased in value, two of them by more than three times the market average. Unfortunately, we know that one of our competitors has been attempting to hire our employees away from us, and she is likely to be on that competitors list of targets. To retain her services, we should substantially increase her salary, contingent on her willingness to sign a non-compete agreement.
To what extent do you agree or disagree with the reasoning in the statement above?
Let’s analyze this together. Take this argument apart and post your thoughts here. Then I’ll jump in and help put it all together…
7 comments
Siddharth Aich on July 22nd, 2012 at 12:26 pm
Given that she has been a good performer and acted in the best interests of the company, it is imperative to afford recognition and appreciation to such an employee regardless. It is also likely that she possesses good moral character and has a sense of loyalty towards her organization and may not be interested in exploring other opportunities at all. Having said that, it is also not wrong to be drawn towards a lucrative offer from a competitor which could provide a step up financially and professionally. Therefore, it is best to sit down with the chief financial advisor and reward her appropriately. Rewards could be in monetary terms or an improvement in work-life balance, or a mix of both. The signing of the non-compete agreement should not be imposed by the management. If she's really an asset for the company, she should be retained by reasonably fulfilling whatever expectations she has. The management should capitalize on the relationship that they have established with her and continue to endorse their confidence and trust in her.
Tyler Newton on August 16th, 2012 at 4:36 pm
Since the chief financial advisor has proven herself to be an essential member of our personnel, we certainly want to keep her as a member of the pack. The problem with the above suggestion is it assumes for management to begin negotiations with the adviser about an increase in her pay without knowledge of a potentially poor-performing competitor's ability to afford her. To introduce a non-compete agreement reveals worry among the board; should she fail to sign such a document, she may become inclined to study her options instead of our stocks. Master Sun Tzu famously taught never to reveal weakness. She shall be publicly recognized for her success. Also, more members of company personnel should be under her control to keep her competitively engaged, keep her division profitable, and keep the company strong. I suggest we consider other valuable people for her to manage with, perhaps, marginal individual pay increases or shifts in responsibilities to make her job easier.
can on August 17th, 2012 at 7:40 am
hello
Daniel on October 3rd, 2012 at 4:44 am
I agree that we should increase her salary, but not necessarily substantially. The contingency on a non-compete agreement is a good starting poit in negotiating her raise. Her performance has been impressive, but investment appreciation may be affected by luck. Her performance may not repeat again, or it could be achieved by a new hire if we lose her. The risk of a competitor trying to take her away from us suggests that her market value is higher than what we currently pay her. Also, losing her would require an investment into training her replacement. About the non-compete agreement, it is not critical for us, because of her commitment to our company. The evidence is that she has stuck with us for at least one year. To summarize, we should increase her salary somewhat and consider a non-compete agreement as a negotiable clause.
(disclaimer: no experience in GMAT yet; excuse my style)
Abhishek on October 23rd, 2012 at 10:40 pm
Having a Good Performer in an organization is an asset to the Firm but also at the same time there are risks associated with it of Losing her/him to competition.
The Chief Financial Advisor is definitely an asset to the Company looking at her track record of the investments she has done for the Firm over the past years. Considering the threat of losing her to competition it is imperative that the management sits with her and discusses Future Plans and Career progressions for her in the Firm. They should also understand her expectations from the Firm. Address her expectation through her career progressions and non monetary benefits rather than increasing her salary which may set a wrong precedence for other employees in the Firm. They should also look at giving employees under her who would learn the Art of Investments fom her and can take her responsibilities in case of her movement to the competition. The firm should only look at providing oppotunities to her to acheive her desired goals rather than setting a wrong precedence in the Firm for other employees
Tyler Newton on November 29th, 2012 at 9:23 am
I mostly agree. Considering, however, that she is already the Chief Financial Officer, promotion cannot be the answer - so, restructuring human assets to give her shorter hours and more opportunities to train others is imperative.
Kapil on January 23rd, 2013 at 12:08 pm
CFO has certainly impressed the author by her past year's performance. Her majority of stock investments have been profitable and few outperformed the market returns by good margin. Her past year record is impressive, however there are few other things to watch out before author should give her an outstanding salary offer with non-compete agreement.
First would be to watch out for more time. In a bulls market majority of stocks would do well. She could be a bit lucky in getting 20% stocks outperform the market. 1 year duration is not much to identify any ones performance in this market. She certainly looks promising prospect and needs to be given some more time to be judged.
Second, he is assuming she is on her competitor's list. This may or may not be true.
In either case the author should meet the CFO and convey appreciation along with the amount of trust company has in her. Author should share the future goals/prospects company has and how she could align her career growth along with companies.