Which of the following most logically completes the argument : GMAT Critical Reasoning (CR)
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# Which of the following most logically completes the argument

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Which of the following most logically completes the argument [#permalink]

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13 May 2008, 20:04
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27.
Which of the following most logically completes the argument below?

When interest rates are high, insurance companies reduce the premiums they charge for many kinds of insurance policies. The reason is that insurance companies want to take in as much money as possible in premiums so that they can invest the money at high rates of interest. And premium reductions help achieve this objective, since __________.

(A) interest rates are likely to decrease when large amounts of money are available for loans
(B) smaller insurance companies are not able to amass enough money to take advantage of investing at high interest rates
(C) insurance companies can sell many more insurance policies if they charge lower premiums than they would if they left premiums unchanged
(D) an increase in the number of policies sold eventually leads to an increase in the number of claims that an insurance company has to pay
(E) the number of claims that insurance companies pay increases at a higher rate than does the number of policies that the insurance companies can sell at the lower premiums
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13 May 2008, 20:34
C...
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14 May 2008, 03:44
i also say C
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14 May 2008, 04:33
Straight C
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14 May 2008, 07:02
C for me.
Argument was a little tough but choices are easy.
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14 May 2008, 07:20
sondenso wrote:
27.
Which of the following most logically completes the argument below?

When interest rates are high, insurance companies reduce the premiums they charge for many kinds of insurance policies. The reason is that insurance companies want to take in as much money as possible in premiums so that they can invest the money at high rates of interest. And premium reductions help achieve this objective, since __________.

(A) interest rates are likely to decrease when large amounts of money are available for loans
(B) smaller insurance companies are not able to amass enough money to take advantage of investing at high interest rates
(C) insurance companies can sell many more insurance policies if they charge lower premiums than they would if they left premiums unchanged
(D) an increase in the number of policies sold eventually leads to an increase in the number of claims that an insurance company has to pay
(E) the number of claims that insurance companies pay increases at a higher rate than does the number of policies that the insurance companies can sell at the lower premiums

C is good.
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15 May 2008, 04:21
year, OA is C

I wish that you attached with your choice some reasoning, better!
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15 May 2008, 08:26
IR high -> IC reduce premiums for many IP's.
Reason : IC make $'s by investing$ at higher IR.

Before we look at the choices - a Premium reduction would mean that consumer pay's less but somehow the IC has to make more money. So we are looking for something similar to this in the answer choices. And C stands out saying "pick me"

sondenso wrote:
27.
Which of the following most logically completes the argument below?

When interest rates are high, insurance companies reduce the premiums they charge for many kinds of insurance policies. The reason is that insurance companies want to take in as much money as possible in premiums so that they can invest the money at high rates of interest. And premium reductions help achieve this objective, since __________.

(A) interest rates are likely to decrease when large amounts of money are available for loans
(B) smaller insurance companies are not able to amass enough money to take advantage of investing at high interest rates
(C) insurance companies can sell many more insurance policies if they charge lower premiums than they would if they left premiums unchanged
(D) an increase in the number of policies sold eventually leads to an increase in the number of claims that an insurance company has to pay
(E) the number of claims that insurance companies pay increases at a higher rate than does the number of policies that the insurance companies can sell at the lower premiums
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15 May 2008, 17:39
yavasani wrote:
Before we look at the choices - a Premium reduction would mean that consumer pay's less but somehow the IC has to make more money. So we are looking for something similar to this in the answer choices. And C stands out saying "pick me"

Thanks yavasani!
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Re: Pr.4.27.CR.Incomplet argument   [#permalink] 15 May 2008, 17:39
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