GMAT Essays (AWA)

"The average price of an acre of land in the United States is now 50 times what it was in 1970, and nearly 200 times what it was in 1920. The nation's population is projected to keep increasing, even as the amount of land remains constant. Therefore, people who are approaching retirement should invest heavily in real estate in order to ensure their financial security."

The argument that People approaching retirement should invest heavily in real state to ensure their financial security as the price of the land is 50 times what it was in 1970 and nearly 200 times what it was in 1920 seems persuasive. However, one cannot relie in the statistic as the price at different time is not given. At the same time, investment in real state is not compared to other investment areas. Thus, the argument is baseless and lack concrete reasoning.

The conclusion of the argument is based on the statistics, which lack the detail in the price in 1970 and in 1920. What if the price in 1970 was less than one fourth of the price in 1920. In that case, the real state price would show decrease in price with time rather than increase in price. It can be assumed that price in 1970 was greater than price in 1920 but the argument lack evidence to support such senario.

Secondly, the argument doesn't give any data regarding the appreciation of the dollar, inflation, and rate of rise in the price of real state. If the rate of increase in the price is greater than inflation there is real increase in the real state value. However, if the case is opposite, the real increase in price of real state is infact negative.

Thirdly, the argument lack the comparision in the investment in real state and other investment areas such as insurance, retail,gold,banking, which could give more return compare to real state in a long run.

Finally, the argument doesn't specify the amount of land available, rate of increase in the population, future requirement of land, so as to anticipate the increase in the value of the real state.

Hence, the argument is baseless and rely on multiple assumptions which cannot be ignored. Had the author put enough evidence to support these assumption the conclusion could have been much stronger.

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