Against a backdrop of turbulent markets,

Dear 800orDie,

I'm happy to respond, per your request. I am sorry to say that I am not a fan of this question.

Against a backdrop of turbulent markets, the Fed now voted 9-1 to hold the rates this time.
A. the Fed now voted 9-1 to hold the rates this time.
Hmmm. Possibly correct. Depending on context and connotation, the "now" and "this time" may or may not be redundant: in a certain reading, they may refer to slightly different things: for example, the "this time" creates a contrast with previous occasions of voting, and thus it has a slightly different referent than the word "now," which simply refers to the immediacy of the present time.

B. the Fed voted 9-1 to hold rates right now.
This is 100% correct, perfectly fine. Uses the infinitive of purpose. The absence of the definite article before "rates" is a bit awkward, but this is certainly not a GMAT-like mistake.

C. the Fed held rates, by voting 9-1 this time.
This is 100% correct, perfectly fine. The connotation is close to that of the prompt. Again, the missing definite article, not a GMAT-worthy mistake.

D. the Fed voted 9-1 to keep rates on hold, for now.
This is grammatically correct, but has a slightly different connotation, a bit different from the connotation of the prompt: not a contrast to the past, but it implies the inevitability of a rate change in the near future. Actually, the wording "keep the rates on hold" --- this is unclear and bit awkward. The current rates are not "on hold": they are active in the interactions between the Federal Reserve and the banks. The Fed may choose not to change the rates, but nothing is "on hold" in that decision except maybe a "rate increase."

E. it was voted 9-1 to hold rates at the Fed, for the time being
This one is trainwreck wrong. It can be dismissed instantly.

Admittedly, choice (A) is debatable, but choices (B) and (C) are both viable answers, your OA (D) has problems, and (E) can be eliminated very quickly. This is not not tricky or subtle: instead, it's a poorly constructed question from the GMAT point of view. A well-written GMAT SC question has only one answer that is unambiguously right, and for each of the incorrect answers, while they may be tempting, there's always some unambiguous mistake that makes the incorrect answer non-negotiably wrong. Again, there's a certain art to constructing wrong answers that will be tempting to many students but which, technically, are incorrect.

I will also point out: the language of referring to the United States Federal Reserve Bank as "the Fed" is extremely casual. Yes, newspapers do this all the time, and it's common in the media, but in the academic language of the GMAT, such "nicknames" are seldom used. The GMAT is incredibly formal and precise in its language. Use academic articles and books as your model, not popular newspapers. Find the most sophisticated reading that you can, and model that language.

I would be interested to hear why you thought that (B) and (C) could reasonably be considered incorrect. Also, do you understand the problems with (D)? Do you see how (E) could be incorrect but still be tempting, closer to correct?

Does all this make sense?
Mike
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This question is certainly not of GMAT quality, and that an experienced instructor gets it wrong only points to the question's inferior quality. But here's my take:

B. I find that "right now" alters the meaning of the question stem by cutting out the inevitability of a subsequent increase implied by "this time". The positioning at the end of the sentence is also awkward; it could be taken to suggest that the rates are to be held urgently. I think that "the Fed right now voted 9-1 to hold rates" conveys the same meaning without the ambiguity.

C. Doesn't "by voting" imply the sort of mechanism by which the rates were held? If so, I'd say that this is an unwarranted assumption, based solely on question stem.

D. This is the original sentence as it appeared on last week's The Economist. I disagree with your nitpicking here; I think the semantic issue you raise about rates being active and not holdable, even if it were true, applies to the other choices too.

E. This choice is clearly wrong. The faux comparison to choice D in your closing paragraph is forced, in my opinion.

Appreciate the time you took to review this.

Dear 800orDie,
Very interesting. I'll make a few comments.

First, the OA, (D). It's interesting that this appeared in The Economist. Their writing is usually of exceptionally high quality. This is an unusual sentence, for them: a bit more casual, a bit off in an "ear-catching" journalistic way. Perfectly understandable for a news magazine that depends on a general readership for revenue, but not quite up to the standards of the GMAT. Ultimately, any news publication, no matter how highbrow, is not going to be as sophisticated as an academic source: any news source ultimately depends on widespread popularity for its revenue, and this dependence is categorically not true for academic journals. The Economist is very good, and some sentences in that high-quality periodical could be sentences on the GMAT SC, but not all of them----it's not an automatic assumption. Also, it's perfectly understand that The Economist would refer to the US Federal Reserve as "the Fed," but this would never happen on the GMAT SC.

The "right now" in (B) could refer to immediacy and urgency, but as I read it, it could be a synonym for "this time," a somewhat more emphatic synonym.
The Fed voted 9-1 to hold rates right now.
The Fed voted 9-1 to hold rates this time. (Either contains a strong implication that the next time would be different!)
This emphasis is a little different from the OA of (D) but it could be read into the prompt, choice (A). This is one tricky thing about starting with a correct sentence and changing it: whatever wrong choice winds up as (A) must have the exact same logical implications as the OA. I am not sure that this is case here.

As for (C), yes, "by voting" in a way implies a mechanism. I don't know whether the stem supports this implication, but in point of fact, this is exactly the mechanism by which the prime lending rate changes. The prime lending rate remains perfectly fixed until the US Federal Reserve board casts a vote, and it is precisely by voting that this rate is changed. By statute, the vote of the US Federal Reserve board is, in fact, the sole mechanism by which the prime lending rate can change. Again, whether this implication is supported by the prompt is debatable, but it is indubitably supported by the facts.

I think we agree that (E) is clearly wrong. I don't recall making any comparison of this to any other answer choice: among the answer choices, this is the only one that can be eliminated instantly. I don't know whether you appreciate the basic features of item response theory. An answer choice that is exceptionally easy to eliminate quickly does not serve the overall question quality. A truly high quality question has one unambiguously right answer, and four answer that are quite tempting even though they are unambiguously wrong. This is an incredibly lofty standard, which I sometimes hit in my own question creation. I am simply astonished by how often the official questions are at that level.

I applaud your efforts at question creation. If this becomes an exercise in refining your own thinking, so that it more closely matches the mindset of the test makers, then this endeavor would be well worthwhile.

Mike
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