Correct Option D

Sentence meaning is based on cause to effect or one made to another to do
Cause : Since 1986 when the Department of Labor began to allow fees of investment officers to be based on the performance of the funds they manage
Effect : several corporations have begun paying their investment advisers a small basic fee, with a contract promising higher fees if the managers perform well.

original sentence:
Since 1986 when the Department of Labor began to allow investment officers' fees to be based on how the funds they manage perform, several corporations began paying their investment advisers a small basic fee, with a contract promising higher fees if the managers perform well.

Elimination Process :
1. began to allow to have begun paying - Eliminates A, B, and E
(A) investment officers' fees to be based on how the funds they manage perform, several corporations began
(B) investment officers' fees to be based on the performance of the funds they manage, several corporations began
(E) that investment officers' fees be based on the performance of the funds they manage, several corporations began

2. Remaining with C, and D
C has flaw [usage of that fees, refer to allow / usage of How - undescribable] makes its wordy and looses grip on intended meaning.
(C) that fees of investment officers be based on how the funds they manage perform, several corporations have begun.

(D) fees of investment officers to be based on the performance of the funds they manage, several corporations have begun - Correct option D

Hi,

But there is a rule which says that an adjective can't be the antecedent of pronoun, right ? (Please correct me, if I am wrong). Though, the prepositional phrase 'of the investment officers' is not exactly an adjective, it does act like an adjective which modifies the noun 'fees', right ?
In that case, can 'they' refer to 'investment officers' ?
--
Should I just remember that proper adjectives can't be antecedents of pronouns but the noun entities in the prepositional phrases can be ?

Would be great if you can help by sharing your thoughts. egmat GMATNinja

Thank you.
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Sounds like you've almost answered your own question!

The object of a prepositional phrase (in this case, "investment officers") is in fact a noun, so it's no problem for a pronoun to refer to that noun. On the other hand, the entire prepositional phrase is a modifier, and of course it wouldn't make any sense for a pronoun to refer to the entire prepositional phrase (preposition + object).

I hope that helps!
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Hi IanStewart -

gave the following analogy of active vs passive as a similar construction to the oiginal problem (which was very helpfull)

Active : I can't allow the class to take the math test in these conditions
Passive : I can't allow the math test to be taken (by the class) in these conditions

I actually thought the passive voice in this analogy and the passive voice in the original - BOTH CASES DO NOT WORK because literally speaking – the sentence in the passive voice is implying you cant allow the math test to do something

Almost as if the math test itself is hoping to perform an action. Then the math test asked for your permission. You denied the math test permission

contd from above...

IanStewart

The reason I say this is because literal meaning is a strategy often employed when eliminating other official problems
Official example # 1 = Answer A can be eliminated because literally this means, Railroad Employees themselves are going to be added to the increase, which doesnt make sense.

Official example # 2 = Answer A is also eliminated per the official explanation, because scientsts themselves cant be BASED ON accounts ...

Simirilarly, I am struggling to understand why the passive contruction is okay in the analogy | original problem because in both cases (analogy | original problem)

You are giving way / giving permission to Fees / Math tests so that the fees / math tests themselves can peform an action

You're leaving out some important words when you only highlight part of the sentence. What is not allowed to happen, in the passive example, is that "the math test be taken" under whatever conditions are problematic. The math test itself isn't being given permission to do or not do something -- that would only be true if the verb was active: "I can't allow the math test to go to the party" for example, would be a sentence where the math test was (nonsensically) being denied permission to do something. When the verb is passive, "to be taken", the math test becomes the object, not the subject, of the verb. We use constructions like this quite often, and there's nothing illogical about them. A sentence like "The law does not permit hazardous chemicals to be combined with ordinary household garbage" is a perfectly good sentence, and there's no suggestion that "hazardous chemicals" are being denied permission to do something. It's the people who dispose of garbage who are denied permission to do something with hazardous chemicals in this sentence.
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Hi IanStewart -

here is the passive voice of option D (getting rid of a lot of the modifiers)

Passive voice: The DOL began to allow fees to be based on performances.

I have tried making the active voice for option D. I think the active voice doesnt make any sense because you are suggesting -- you are allowing the subject - Performances to do something

Active voice: The DOL began to allow performances to base fees.

Just curious on your thoughts on my attempt to create the active version for option D.

In passive constructions, the subject is often unmentioned, and if you want to rephrase a passive sentence in an active way, you may need to identify and insert the subject, (adding "by X") first. So in this sentence, for example:

The party was shut down because of noise complaints.

it's not clear who shut the party down (and we often prefer passive constructions like this when the subject is not that important -- the point of this sentence is that the party ended) but if we guess it was the police who shut it down, we can add the subject to the sentence above:

The party was shut down by police because of noise complaints.

and now we can rephrase this in an active way:

Police shut down the party because of noise complaints.

The same thing is true of the original sentence here -- the subject isn't mentioned. Who bases fees on performance? Presumably the investment officers charging the fees. So "DOL allowed fees to be based on performance" becomes, inserting our predicted subject, "DOL allowed fees to be based by investment officers on performance" (this is now a very awkward sentence) which becomes, as an active sentence, "DOL allowed investment officers to base their fees on performance". It's more complicated than my original example because of the string of two verbs ("allowed", "to base") but the general principle is the same.
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The answers provided are amazing

Hello,

I can't understand why C° is wrong.

Can anyone help please

(C) has a meaning issue. Typically, "allow that" means something like "concede that" or "admit that." For instance:

I'll allow that Tim isn't the best dad, but I was still surprised when he attempted to reenact the climactic scene of Jaws with a real shark and his toddler.

The meaning here is that while the author admits that he knows Tim isn't a great dad, he was still surprised by his negligence.

Now apply that interpretation of "allow that" to the relevant portion of (C):


So in 1986 the Department of Labor began to admit that the fees were based on how the funds performed? Nah.

It makes far more sense to use "allow" in the sense of "permit," because the Department of Labor is making the rules, not admitting that they exist. This is the meaning we get in (D).

I hope that clears things up!
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Hi GMATNinja,

Could you please explain why "have begun" is correct and "began" is wrong? I read a few explanations, and since I'm not a big fan of jargon, I couldn't really understand the difference. It would be really very helpful if you could explain it with some example

"Have + VERB" suggests an action that started in the past and continues into the present. The construction "Since + YEAR," implies the same -- the action started in the specified year and is ongoing.

Here, have an example:

"The Sacramento Kings have made brilliant personnel decisions since 2003."

Translation: the team started making brilliant decisions in 2003 and they continue to make brilliant decisions today. (Apologies to all seven Kings fans out there.)

In the official example, we're talking about a behavior that's been happening "since 1986," so the "have" correctly conveys the fact that the behavior has occurred from 1986 through the present.

Put another way, I could write, "In 1986, several corporations began," or "Since 1986, several corporations have begun."

No jargon necessary! For more low-jargon rambling about verb tenses, check out this video.

I hope that helps!
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Hi GMATNinja - other than "since..." -- what other trigger words do you look out for, when thinking about using the present perfect ?

As far as trigger words go, "since" is the most obvious one, but I don't recommend memorizing a list and then hunting for those words.

Instead, I'd wait until I saw a present perfect verb in an answer choice. Then I'd ask, "would it make sense if this action started in the past and continues into the present?" If I then saw the word "since", that would be one good justification. But if it just made logical sense for the action to be ongoing, well, that's a good justification too, even if there's no identifiable trigger. Either way, I'm hanging on to that option and looking for other issues.

Put another way, if I think about the verb tense logically and use context, I'm unlikely to go astray. But if I go in looking for certain key words and then blindly assume that the present perfect is wrong if I don't see those words, I might convince myself that a certain construction is incorrect, even when it isn't.

I hope that helps!
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Hello, I am having trouble in understanding the rules of pronoun and what can be pronoun's antecedent.(Regarding possessive)

For instance, as far as I know, 'they' cannot have 'investment officers' as the antecedent in option A, saying 'investment officers' fees~'. This is because 'investment officer's' is possessive.
Similarly, I thought 'they' cannot have 'investment officers' as the antecedent in option D. Because, 'fees of investment officers' can be seen equal with 'investment officers' fees~', and both are possessive.
Can you experts please correct my misconception?

Thank you very much for your help.

GMATNinja egmat

Hello celan,

We hope this finds you well.

To answer your query, the rule that only possessive pronouns can refer to possessive nouns is not one that the GMAT really follows anymore; thus, a subject or object pronoun can be used to refer to the base of a possessive noun.

We hope this helps.
All the best!
Experts' Global Team
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