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cr - grad school

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Manager
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cr - grad school [#permalink] New post 16 Feb 2005, 19:15
Graduate schools have begun to check whether applicants for admission are in default on government-guaranteed student loans. Any application submitted by an applicant who fails this test is not processed. Though all applications are tested, it is thought that the 3 percent of the applications that fail represent only three-quarters of the incoming applications from individuals in default. Consequently, approximately 1 percent of the applications that are processed are those of applicants in default who remain undetected.

Which of the following is an assumption in the argument above?

a-Before being processed, the applications from individuals in default on their government-guaranteed student loans are not rejected for other reasons.

b-Applicants in default on their government-guaranteed student loans will not make any loan payments in the future.

c-In all likelihood, more than 3 percent of the applications actually fail the default test.

d-Only a small fraction of the individuals in default on their government-guaranteed student loans apply to graduate school.


e-Individuals in default on their government-guaranteed student loans apply to graduate school in the same numbers in which they do not apply to graduate school.
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 [#permalink] New post 16 Feb 2005, 19:41
3 percent of the applications that fail represent only three-quarters of the incoming applications from individuals in default.

Consequently, approximately 1 percent of the applications that are processed are those of applicants in default who remain undetected

3% incoming = 3/4 of the defaulted
=> 1/4 of defaulted = 1%

Between these two statements the assumption is that all applications that were incoming and had defaulted were 'processed', otherwise the percentages don't add up

A)
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 [#permalink] New post 16 Feb 2005, 19:53
A it is...

implies that there in no other mechanism of catching these defaulters and therefore such a filter is needed to be application processing.
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 [#permalink] New post 16 Feb 2005, 22:05
A or B?

Whay not B, guys?
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 [#permalink] New post 16 Feb 2005, 22:08
I think B is a bit out of context and a strong assumption.
I avoid strong choices.
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 [#permalink] New post 16 Feb 2005, 22:42
(A) for me.
- If no individuals are rejected for other reasons, then 1/4 of the undetected defaulters could be due to the argument above.
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 [#permalink] New post 17 Feb 2005, 10:16
One more for 'A'
'B' is out of context because we are not interested in finding out why these people were not processed, we need to find the assumption for the conclusion "approximately 1 percent of the applications that are processed are those of applicants in default who remain undetected"
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 [#permalink] New post 01 Mar 2005, 06:40
I jump on the band-wagon with an A

OA?
  [#permalink] 01 Mar 2005, 06:40
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