oil fuel vs natural gas

[lokesh r]

In order to save money, some of Company X's manufacturing plants converted from oil fuel to natural gas last year, when the cost of oil was more than the cost of natural gas. Because of a sudden, unexpected shortage, however, natural gas now costs more than oil, the price of which has fallen steeply over the past year. The cost of conversion back to oil would more than negate any cost savings in fuel. So Company X's fuel costs this year will be significantly higher than they were last year.

Which of the following is an assumption on which the argument above depends?

(A) Company X does not have money set aside for the increased costs of fuel.
(B) The increase in the cost of fuel cannot be offset by reductions in other operating expenses.
(C) The price of natural gas will never again fall below that of oil.
(D) The cost of fuel needed by those of Company X's plants that converted to natural gas is not less than the cost of fuel needed by those plants still using oil.
(E) The price of oil will not experience a sudden and steep increase.

OA D

Can somone explain OA..

[reply2spg]

I was between B and D, and as usual marked B. But yes D is correct.

It says cost of natural gas is not less than the cost of oil. Language is very difficult. what is the source?

[Tani]

A is irrelevant - the actual cost is independent of whether or not money was set aside.

B is also irrelevant. Again, we are talking about the cost of fuel, not about overall costs, so offsetting fuel costs doesn't address the issue.

C is out of scope. WE are not concerned with what will "never" happen to the prices - only this year.

E is also out of scope. The price of oil is not at issue.

That leaves D. Now that we know that not all plants were converted to gas, we can compare costs increases in gas to cost savings form the oil price drop.