Received a PM to respond to this one.
You are correct in saying that in option A,
“an expense that would have forced its main competitor to declare bankruptcy if it had suffered such a loss” is a Noun (an expense) + Noun Modifier (that .....). However, notice that it cannot refer to “one billion dollar” because it is an adjective. The complete noun phrase here is “a one billion dollar loss”. Hence, this Noun + Noun Modifier refer to this entire noun phrase. This is illogical because a loss cannot be an expense.
Pronoun “it” in “it had suffered such a loss” correctly refers to “main competitor”.
The correct option for this problem is option D
indeed. Study the full sentence with the correct option:
After the company recalled one of its best-selling products, it was forced to accept a one billion dollar loss; its main competitor would have been forced to declare bankruptcy if it had suffered such a loss.
The sentence clearly states the reason why the company was forced to accept a one billion dollar loss. It was forced to do so because it recalled one of its best-selling products. So here we have cause-effect relationship.
The independent clause after semicolon clearly and correctly states that if its main competitor had suffered such a loss, it would have been forced to declare bankruptcy.
Hope this helps.
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