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GMAT Club Legend
Joined: 07 Jul 2004
Posts: 5134
Location: Singapore
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Investing in real estate would be a profitable venture at [#permalink]
15 Oct 2005, 13:15
Question Stats:
0% (00:00) correct
0% (00:00) wrong based on 0 sessions
Investing in real estate would be a profitable venture at this time. A survey in House magazine revealed that 85% of the magazine’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.
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Director
Joined: 21 Aug 2005
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1) B
If B is true, the argument's general idea that Investing in real estate would be a profitable venture at this time will not be applicable to all places.
2) E
The idea of the argument will be true only if the premises come true. E holds that down.
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VP
Joined: 14 Sep 2005
Posts: 1001
Location: South Korea
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IMO, (D) and (E).
1. According to (D), the high demand for a second home is not a general trend. Readers of the house magazine subscribe to the magazine because they are interested in buying homes, so they say "yes I really want a second home", but this cannot be true to everyone. And so there actually might not exist such a high demand among overall people.
2. As gsr explained, they only claim that they will buy a second home, but they in reality do not.
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Current Student
Joined: 28 Dec 2004
Posts: 3439
Location: New York City
Schools: Wharton'11 HBS'12
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I would say D And E
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