interest rates

Expert replies

crazy4gmat: Master | Next Rank: 500 Posts; Posts: 160; Joined: Fri Aug 22, 2008 4:54 am; Thanked: 5 times; GMAT Score:660

by crazy4gmat » Sat Nov 22, 2008 3:10 am

Ronald: According to my analysis of the national economy, housing prices should not increase during the next six months unless interest rates drop significantly.
Mark: I disagree. One year ago, when interest rates last fell significantly, housing prices did not increase at all.
It can be inferred from the conversation above that Mark has interpreted Ronald’s statement to mean that
(A) housing prices will rise only if interest rates fall
(B) if interest rates fall, housing prices must rise
(C) interest rates and housing prices tend to rise and fall together
(D) interest rates are the only significant economic factor affecting housing prices
(E) interest rates are likely to fall significantly in the next six months

Source: Beat The GMAT — Critical Reasoning | Sat Nov 22, 2008 3:10 am

Jatinder: Master | Next Rank: 500 Posts; Posts: 280; Joined: Tue Sep 30, 2008 4:18 am; Thanked: 5 times; GMAT Score:610

by Jatinder » Sat Nov 22, 2008 6:16 am

IMO B

(when (A)interest rates last fell significantly, (B)housing prices did not increase at all. )

if A then B

Keep flying

mals24: Legendary Member; Posts: 683; Joined: Tue Jul 22, 2008 1:58 pmFollowed by: 2 members; Location: Dubai; Thanked: 73 times

by mals24 » Sat Nov 22, 2008 6:42 am

Agree with Jatinder

According to Mark: If interest prices fall, then Housing prices will increase.
B is the only option that shows an 'If and Then' relationship.

One more vote for B.

iamcste: Legendary Member; Posts: 940; Joined: Tue Aug 26, 2008 3:22 amFollowed by: 1 member; Thanked: 55 times

by iamcste » Sat Nov 22, 2008 6:51 am

Guys, dont you think "signifcantly" is not considered in B

and its a key word as they are not talking about any interest rise but
"signficant rise"

I dont i am bit skeptical abut B and get more inclined towards E

am i missing anything ?

mals24: Legendary Member; Posts: 683; Joined: Tue Jul 22, 2008 1:58 pmFollowed by: 2 members; Location: Dubai; Thanked: 73 times

by mals24 » Sat Nov 22, 2008 6:58 am

@imcste

E is incorrect because it says that the interest rates are likely to fall in the next 6 months.
We don't know if interest rates will fall in the next months. Since this information is not given E is incorrect.

B is correct because Ronald says housing prices will not increase unless interest rates fall. This implies that If interest rates fall, then housing prices will increase. Otherwise they will not increase.

iamcste: Legendary Member; Posts: 940; Joined: Tue Aug 26, 2008 3:22 amFollowed by: 1 member; Thanked: 55 times

by iamcste » Sat Nov 22, 2008 7:01 am

mals24 wrote:@imcste

E is incorrect because it says that the interest rates are likely to fall in the next 6 months.

Both Mark and Ronald did not mention that the interest rates will fall

Ronald said that the housing prices should not increase.

Should not increase could me remains consistent as well, not necessarily go down. Hence, since fall in interest rates is not mentioned this option is incorrect.

B is correct because Ronald says housing prices will not increase unless interest rates fall. This implies that If interest rates fall, then housing prices will increase. Otherwise they will not increase.

Could be --this is one part of the question...

Is "significantly " required in the correct ans..If not, does this mean, it has no impact in this qtn..If yes, it should reflect in the ans

what say?

mals24: Legendary Member; Posts: 683; Joined: Tue Jul 22, 2008 1:58 pmFollowed by: 2 members; Location: Dubai; Thanked: 73 times

by mals24 » Sat Nov 22, 2008 7:17 am

I agree with you iamcste that significantly is required in the answer choices, because Ronald specifically says 'unless interest rates fall significantly'.

B would have been better if the word significantly was there. But then again its the best of the remaining.

Plus since this is an inference question we have to stick to what information is given. Now no where in the argument is it mentioned that the interest rates will fall significantly in the next 6 months. They could fall after 6 months or before or exactly after 6 months. Since this information is not mentioned this option is incorrect.

nicolette: Master | Next Rank: 500 Posts; Posts: 197; Joined: Tue Apr 22, 2014 4:03 am

by nicolette » Fri May 13, 2016 1:41 am

B is the most suitable option in this case

vanessa.m: Master | Next Rank: 500 Posts; Posts: 100; Joined: Tue Aug 05, 2014 3:58 am

by vanessa.m » Fri May 13, 2016 1:44 am

I olso think that B looks more convincing than other answers

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