Even though it was no longer cost-effective for the government to conv

A it is: by giving merchants an excuse to round all prices up to

Even though it was no longer cost-effective for the government to convert metals into coins to create the currency's one-cent and five-cent pieces, a spokesperson for a grassroots organization claimed that discontinuing the coins would hurt consumers by giving merchants an excuse to round all prices up to the nearest ten cents.

1st Check Speech : Direct or indirect : a spokesperson for a grassroots organization claimed that (Indirect Speech)

Verbs cant be in present tense (unless it is universal truth)

A) by giving merchants an excuse to round all prices up to
B) by its giving to merchants an excuse to round all prices up to -- by its giving -- awkward
C) in its giving merchants an excuse of rounding all prices up to -- in its giving -- awkward.
D) because it gives merchants an excuse to round up to all prices -- present tense can not be used in indirect speech -- highlighted part is in awkward.
E) because it is giving merchants an excuse to round prices to -- present tense -- not allowed.

Even though it was no longer cost-effective for the government to convert metals into coins to create the currency's one-cent and five-cent pieces, a spokesperson for a grassroots organization claimed that discontinuing the coins would hurt consumers by giving merchants an excuse to round all prices up to the nearest ten cents.

A) by giving merchants an excuse to round all prices up to
B) by its giving to merchants an excuse to round all prices up to
C) in its giving merchants an excuse of rounding all prices up to
D) because it gives merchants an excuse to round up to all prices
E) because it is giving merchants an excuse to round prices to

B, C, D and E - Use the word "it" (or "its") a pronoun that must (on the GMAT) have a clear antecedent. From the context you can infer that "it" is "discontinuing the coins" which is a hypothetical situation.

Hence A

So close on selecting D, but selected OA at last!
B,C,D & E all use "it" or "its", with no proper antecedent.

Expert help needed here:
Why is D wrong because "it" in D can refer to "discontinuing the coins"
svasan05 can you help?
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Hi

Option (D), when plugged in, gives the following sentence:

Even though it was no longer cost-effective for the government to convert metals into coins to create the currency's one-cent and five-cent pieces, a spokesperson for a grassroots organization claimed that discontinuing the coins would hurt consumers because it gives merchants an excuse to round up to all prices the nearest ten cents.

I can think of three reasons for eliminating option (D).

a) The "it" in the underlined portion does not have a clear antecedent. It could refer to any one of several preceding nouns/noun ideas. However, I am always skeptical to eliminate an answer option based only on an ambiguous antecedent. In this case, we have an option (A) which does not involve any ambiguous antecedent so that should be preferable (provided it has no other errors, of course)
b) One could reasonably argue that the "it" refers to "discontinuing the coins". However, this would then become a hypothetical subjunctive which requires the usage of "would give" and not the simple present tense "gives".
c) "to round up to all prices" is an incorrect construction. The correct construction would be "to round all prices up to".

Hope this helps.
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