The Commerce Department

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garima99: Master | Next Rank: 500 Posts; Posts: 217; Joined: Tue May 31, 2011 9:42 pmFollowed by: 2 members; Thanked: 8 times

by garima99 » Tue Jun 28, 2011 8:17 pm

The Commerce Department recently put limits on machine-tool imports from two countries whose exports of machine tools into the United States have been substantial. As a result of these restrictions, analysts predict that domestic sales of machine tools manufactured in the United States are bound to rise considerably, starting in the very near future.
Which of the following, if true, would be most likely to cause the analysts' prediction to be inaccurate?
(A) A new tax bill that, if passed, would discourage investment in capital equipment such as machine tools is being studied and debated seriously in the United States Congress.
(B) United States companies' orders for metal-cutting machines, which account for 75 percent of sales by the machine-tool industry, rose faster than orders for other types of machine tools during the past year.
(C) Worldwide orders for machine tools made in the United States dropped by more than 10 percent during the past year.
(D) Substantial inventories of foreign-made machine tools were stockpiled in the United States during the past year.
(E) Companies in the industrial sectors of many countries showed a significantly expanded demand for machine tools during the past year.

Source: Beat The GMAT — Critical Reasoning | Tue Jun 28, 2011 8:17 pm

abhishek.pati: Senior | Next Rank: 100 Posts; Posts: 83; Joined: Mon Apr 25, 2011 11:27 am; Thanked: 1 times

by abhishek.pati » Tue Jun 28, 2011 8:31 pm

IMO A
Whats the OA??

navami: Legendary Member; Posts: 540; Joined: Sat Dec 20, 2008 7:24 pmFollowed by: 6 members; Thanked: 37 times

by navami » Tue Jun 28, 2011 9:25 pm

IMO D

This time no looking back!!!
Navami

singh181: Master | Next Rank: 500 Posts; Posts: 121; Joined: Fri Mar 13, 2009 8:44 amFollowed by: 1 member; Thanked: 9 times; GMAT Score:610

by singh181 » Tue Jun 28, 2011 9:48 pm

garima99 wrote:The Commerce Department recently put limits on machine-tool imports from two countries whose exports of machine tools into the United States have been substantial. As a result of these restrictions, analysts predict that domestic sales of machine tools manufactured in the United States are bound to rise considerably, starting in the very near future.
Which of the following, if true, would be most likely to cause the analysts' prediction to be inaccurate?
(A) A new tax bill that, if passed, would discourage investment in capital equipment such as machine tools is being studied and debated seriously in the United States Congress.
(B) United States companies' orders for metal-cutting machines, which account for 75 percent of sales by the machine-tool industry, rose faster than orders for other types of machine tools during the past year.
(C) Worldwide orders for machine tools made in the United States dropped by more than 10 percent during the past year.
(D) Substantial inventories of foreign-made machine tools were stockpiled in the United States during the past year.
(E) Companies in the industrial sectors of many countries showed a significantly expanded demand for machine tools during the past year.

restrictions on the import of machine tool parts will immediately cause increase in demand of domestic machine tool parts.
to break the argument there is no other way that can help to meet the demand of machine tool part.
a. a new tax bill is being considered, which if passed will cause loss to both the industries (outside and inhouse) IRRELEVANT
b. increase in demand of machine tool parts. STRENGTHEN
c. talks about worldwide orders. We are intrested in local demand of machine tool orders. IRRELEVANT
d. we have a reserve of machine tool part. This can help us to understand a possible reason for the imposed restrictions. So, the demand of local machine tool parts may not increase. WEAKEN
e.Increase in demad of machine tool parts. but we have relationship between the local US machine tool part industries and increase in demand.

IMO D

Geva@EconomistGMAT: GMAT Instructor; Posts: 905; Joined: Sun Sep 12, 2010 1:38 amFollowed by: 123 members; Thanked: 378 times; GMAT Score:760

by Geva@EconomistGMAT » Tue Jun 28, 2011 11:00 pm

garima99 wrote:The Commerce Department recently put limits on machine-tool imports from two countries whose exports of machine tools into the United States have been substantial. As a result of these restrictions, analysts predict that domestic sales of machine tools manufactured in the United States are bound to rise considerably, starting in the very near future.
Which of the following, if true, would be most likely to cause the analysts' prediction to be inaccurate?
(A) A new tax bill that, if passed, would discourage investment in capital equipment such as machine tools is being studied and debated seriously in the United States Congress.
(B) United States companies' orders for metal-cutting machines, which account for 75 percent of sales by the machine-tool industry, rose faster than orders for other types of machine tools during the past year.
(C) Worldwide orders for machine tools made in the United States dropped by more than 10 percent during the past year.
(D) Substantial inventories of foreign-made machine tools were stockpiled in the United States during the past year.
(E) Companies in the industrial sectors of many countries showed a significantly expanded demand for machine tools during the past year.

In order to find the right answer here, you need to understand the core of the argument's reasoning.

The premises are the limitations of tool imports - we're importing fewer tools now.
From this fact, analysts have jumped to the conclusion that the the locally manufactured tools will jump in to fill the void, and thus will sell more.
We want to weaken that conclusion which can be done by attacking the assumption at the base of the argument. In order to reach the conclusion that domestic tools will fill in the void, we have to assume that there is a void in the first place - that cutting imports will lead to a dearth in tools. D weakens the argument by attacking that assumption - the stockpile of imported tools means that the supply of imported tools will not be reduced by the import restrictions, so there will be no void for the domestic tools to fill.

Geva
Senior Instructor
Master GMAT
1-888-780-GMAT
https://www.mastergmat.com

abhishek.pati: Senior | Next Rank: 100 Posts; Posts: 83; Joined: Mon Apr 25, 2011 11:27 am; Thanked: 1 times

by abhishek.pati » Wed Jun 29, 2011 8:11 pm

got it now...should be D....Thanks guys!!!

worldpeace93: Junior | Next Rank: 30 Posts; Posts: 21; Joined: Sun Jun 05, 2011 10:39 pmFollowed by: 1 member; Thanked: 2 times

by worldpeace93 » Thu Jun 30, 2011 2:38 am

D:)

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