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Investing in real estate would be a profitable venture at [#permalink]
19 Jul 2005, 16:28
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Investing in real estate would be a profitable venture at this time. A survey in House magazine revealed that 85% of the magazineâ€™s readers are planning to buy a second home over the next few years. A study of the real estate industry, however, revealed that the current supply of homes could only provide for 65% of that demand each year.
Which of the following, if true, reveals a weakness in the evidence cited above?
(A) Real estate is a highly labor-intensive business.
(B) Home builders are not evenly distributed across the country.
(C) The number of people who want second homes has been increasing each year for the past ten years.
(D) Readers of House magazine are more likely than most people to want second homes.
(E) House magazine includes articles about owning a second home as well as articles about building a second home.
Which of the following, if true, would undermine the validity of the investment advice in the paragraph above?
(A) Some home owners are satisfied with only one home.
(B) About half of the people who buy homes are investing in their first home.
(C) About half of the people who buy homes have to take out a mortgage to do so.
(D) Only a quarter of the homes that are built are sold within the first two weeks.
(E) Only a quarter of those who claim that they want a second home actually end up purchasing one.
Not (A). It doesn't provide any related information
Not (C). The same as A
Not (D). It clearly states, that current supply CANNOT meet even the demand of House readers, not mentioning that of other non-readers who want to buy a second home. Thus there will be a great home supply shortages which will make the price of the home rise and investment profitable.
Not (E). I can't find any clue that may bring us to (E).
There is only (B) left. Indeed, there may be many provinces where there are home builders shortages, which may make building new buildings impossible.