2. Bonuses at DSR Industries cannot be awarded unless profits exceed a ten percent return on stockholders' investments in the company. Higher profits mean higher bonuses. Therefore, bonuses in a year of general economic recession will be considerably lower than bonuses in a year of peak profits at DSR.
The conclusion above depends on the assumption that
(A) the firm will have relatively low profits in recession years
(B) the amount represented by a ten percent return on stockholders' investments in the company will increase from year to year
(C) profits rarely exceed a ten percent return on stockholders' investments in the company
(D) profits in excess of a ten percent return on stockholders' investments in the company are all distributed in the form of bonuses
(E) bonuses at DSR never drop to zero
Ans : A
My choice and explanation is as below within the spoiler.. can you please tell me why my reasoning wont hold good.
[spoiler]
I chose D as negating D impacts the conclusion. How can A be right?
Even if during recession if the firm has lower profits, and in the year during peak if the profits is not given off as bonus, then bonus during peak profits is lower than bonus during recession and if this is not the case then the conclusion will fall through.[/spoiler]
The conclusion above depends on the assumption that
(A) the firm will have relatively low profits in recession years
(B) the amount represented by a ten percent return on stockholders' investments in the company will increase from year to year
(C) profits rarely exceed a ten percent return on stockholders' investments in the company
(D) profits in excess of a ten percent return on stockholders' investments in the company are all distributed in the form of bonuses
(E) bonuses at DSR never drop to zero
Ans : A
My choice and explanation is as below within the spoiler.. can you please tell me why my reasoning wont hold good.
[spoiler]
I chose D as negating D impacts the conclusion. How can A be right?
Even if during recession if the firm has lower profits, and in the year during peak if the profits is not given off as bonus, then bonus during peak profits is lower than bonus during recession and if this is not the case then the conclusion will fall through.[/spoiler]
