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# Investing in real estate would be a profitable venture at

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Director
Joined: 25 Aug 2007
Posts: 927

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WE 1: 3.5 yrs IT
WE 2: 2.5 yrs Retail chain
Investing in real estate would be a profitable venture at [#permalink]

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05 May 2010, 23:56
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Question Stats:

78% (01:11) correct 22% (01:00) wrong based on 61 sessions

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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 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, 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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Manager
Joined: 20 Feb 2009
Posts: 75

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Location: chennai
Re: Real estate investment would be a profitable venture [#permalink]

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06 May 2010, 04:37
1
KUDOS
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, 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.

Conclusion:
Investment in real estate is profitable.

Premise : 85% of magazine readers planned to buy second house. ( Current Demand )
Counter Premise : Current supply of House could satiesfy 65% of the demand.

We need to tell that investment advice is not profitable.

(A) Some home owners are satisfied with only one home. ( we dont know the number )

(B) About half of the people who buy homes are investing in their first home.---Wrong Answer--- ( Any how people are purchasing house)

(C) About half of the people who buy homes have to take out a mortgage to do so. ---Wrong Answer---( Out of scope - we don't care about how they purchase home

(D) Only a quarter of the homes that are built are sold within the first two weeks. ( no need )

(E) Only a quarter of those who claim that they want a second home actually end up purchasing one.---Wrong Answer--( e.x Magazine readers - 100 nos, 85 - second home buyers , quarter of them end up with first home (i.e) 63 of people need to buy the second house which is equal to 63% . So demand is equal to supply. So it is not profitable to invest in second house. )

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Manager
Joined: 20 Feb 2009
Posts: 75

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Location: chennai
Re: Real estate investment would be a profitable venture [#permalink]

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06 May 2010, 06:35
thanks..

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VP
Joined: 17 Feb 2010
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Re: Real estate investment would be a profitable venture [#permalink]

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06 May 2010, 10:54
it is (E).

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Intern
Joined: 13 Oct 2010
Posts: 25

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Re: Real estate investment would be a profitable venture [#permalink]

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21 Oct 2010, 00:13
This is easy. E is the answer.

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Retired Moderator
Status: 2000 posts! I don't know whether I should feel great or sad about it! LOL
Joined: 04 Oct 2009
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Location: Peru
Schools: Harvard, Stanford, Wharton, MIT & HKS (Government)
WE 1: Economic research
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Re: Real estate investment would be a profitable venture [#permalink]

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26 Oct 2010, 14:03
+1 E
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Senior Manager
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Re: Real estate investment would be a profitable venture [#permalink]

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26 Oct 2010, 19:52
+1 E

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Intern
Joined: 21 Dec 2011
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Re: Investing in real estate would be a profitable venture at [#permalink]

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21 Sep 2012, 20:41
However, the right answer is D
Can you explain why E is wrong?

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Manager
Joined: 22 Jun 2016
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Re: Investing in real estate would be a profitable venture at [#permalink]

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12 Sep 2016, 15:18
thutrang90 wrote:
However, the right answer is D
Can you explain why E is wrong?

May I please know the source of question, D can never be the answer. If the houses are not sold in first 2 weeks,it will be sold later and still will be beneficial to invest in real estate business.

Kudos [?]: 3 [0], given: 4

Re: Investing in real estate would be a profitable venture at   [#permalink] 12 Sep 2016, 15:18
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