Given info: Since wood chips occupy less than half the volume of branches

A- irrelevant to the present argument as it is not about transporting
B- OFS
C- OFS
D- Since the volume is less than half, then converting them to chips at the same site results in less transportation costs as more chips can be transported with a less time.
E- OFS

United Lumber will use trees from its forests for two products. The tree trunks will be used for lumber and the branches converted into wood chips to make fiberboard. The cost of this conversion would be the same whether done at the logging site, where the trees are debranched, or at United's factory. However, wood chips occupy less than half the volume of the branches from which they are made.

The information given, if accurate, most strongly supports which of the following?

A) Converting the branches into wood chips at the logging site would require transporting a fully assembled wood-chipping machine to and from the site.
B) It would be more economical to debranch the trees at the factory where the fiberboard is manufactured.
C) The debranching of trees and the conversion of the branches into chips are the only stages in the processing of branches that it would be in United's economic advantage to perform at the logging site.
D) Transportation costs from the logging site to the factory that are determined by volume of cargo would be lower if the conversion into chips is done at the logging site rather than at the factory.
E) In the wood-processing industry, branches are used only for the production of wood chips for fiberboard.

This CR asks for an INFERENCE.
The correct inference is WHAT MUST BE TRUE, given the information in the passage.
One approach is to apply the NEGATION TEST.
When the correct answer choice is negated, the passage will be CONTRADICTED.

Answer choice D, negated:
Transportation costs from the logging site to the factory that are determined by volume of cargo would be HIGHER if the conversion into chips is done at the logging site rather than at the factory.
The negation of D contradicts the passage:
Since wood chips converted at the logging site will occupy less than half the volume of the branches from which they are made, transportation costs will be LOWER if the conversion is done at the logging site.
Since the negation of D contradicts the passage, D is the correct inference: WHAT MUST BE TRUE, given the information in the passage.

The correct answer is D.

Answer as D because it is given that conversion rate is same at both the places.
If transportation cost is determined by volume ofcargo then its better to transport the chips which have lesser volume than the branches.
This option surely support the argument.

This IS an Inference question. Keep in mind that an Inference is not a matter of opinion. There are only a limited number of conclusions that can be drawn from specific, provided evidence. Inference questions can be tricky because they're not as common as other GMAT CR, so students have a hard time recognizing them.

Inference question-stems are usually in one of these formats:

"¢ "Which of the following can be properly inferred from the statements above?"
"¢ "What must be true according to the information provided?"
"¢ "Which of the following follow logically from the author's argument?"

Here's how to approach these questions:

"¢ Accept each piece of evidence as true.
"¢ Don't worry if there's no conclusion in the passage.
"¢ Pre-phrase your own answer BEFORE looking at the answer choices.

It may seem like there's an infinite number of possible inferences that can be made, but keep in mind that an "inference" on the GMAT is not like an "inference" in real life. You have to PROVE something beyond reasonable doubt on the GMAT, so don't allow your own outside "ideas" to lead you to an answer choice that "seems reasonable" but is not supported by the info in the passage. If anything in the premise contradicts an answer choice, it cannot be a logical inference.

Good luck inference-ing your way through GMAT CR.