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Since savings banks have to use short-term deposits to finance long-te

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Since savings banks have to use short-term deposits to finance long-te  [#permalink]

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New post Updated on: 10 Aug 2017, 19:56
3
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A
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C
D
E

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  45% (medium)

Question Stats:

64% (01:07) correct 36% (01:26) wrong based on 437 sessions

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Since savings banks have to use short-term deposits to finance long-term fixed-rate mortgage loans, they sometimes lose money when there is a rise in short-term rates and, on the other hand, they are unable to raise the rates on their mortgages.

(A) when there is a rise in short-term rates and, on the other hand, they are unable to raise
(B) when short-term rates rise and they are unable to raise
(C) when a rise in short-term rates occurs and, correspondingly, there is no rise possible in
(D) with a rise in short-term rates, and they are unable to raise
(E) with short-term rates on the rise and no rise possible in

Originally posted by ajit257 on 21 Dec 2010, 18:01.
Last edited by hazelnut on 10 Aug 2017, 19:56, edited 1 time in total.
Formatted the question & added the source
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Re: Since savings banks have to use short-term deposits to finance long-te  [#permalink]

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New post 22 Dec 2010, 01:57
2
1
ajit257 wrote:
Since savings banks have to use short-term deposits
to finance long-term fixed-rate mortgage loans, they
sometimes lose money when there is a rise in
short-term rates and, on the other hand, they are
unable to raise
the rates on their mortgages.

(A) when there is a rise in short-term rates and, on
the other hand, they are unable to raise
(B) when short-term rates rise and they are unable to raise
(C) when a rise in short-term rates occurs and,
correspondingly, there is no rise possible in
(D) with a rise in short-term rates, and they are
unable to raise
(E) with short-term rates on the rise and no rise
possible in

got stuck between 2 ans choices. Please could someone explain this.


Scanning the choices, we see a 3-2 split right at the start, between "when" and "with". We definitely want "when" in this sentence, so eliminate D and E.

Scanning A, B and C, we see 3 very different connectors: A has "on the other hand", B has "and" and C has "and, correspondingly". "On the other hand" makes no sense in this sentence; there's no simply contrast. Similarly, "and, correspondingly" doesn't flow - "correspondingly" doesn't add anything to the simple "and". C is also passive, whereas B is active - another reason to eliminate C.

Choose B!
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Re: Since savings banks have to use short-term deposits to finance long-te  [#permalink]

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New post 22 Dec 2010, 05:16
Hi Stuart,
I was stuck between b and d. I am not clear about this 3-2 split and how did you choose b over d. thanks for your help !
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Re: Since savings banks have to use short-term deposits to finance long-te  [#permalink]

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New post 22 Dec 2010, 05:46
I'll try to explain.
Can you lose money 'with' a rise in short-term rates?
Can you lose money 'when' there is a rise in short-term rates?

I think second usage is correct.
I chose A over B thinking there is a contrast between two situations. After reading closely, I found that there are two things occurring simultaneously. Therefore, 'on the other hand' is incorrect.
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Re: Since savings banks have to use short-term deposits to finance long-te  [#permalink]

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New post 13 Oct 2016, 21:54
You guys are ridiculous. Everyone just checks the answer and tries to justify it in any manner sounding as logical as he can. How conveniently everyone explained why the answer should be B. Can't you see the clear ambiguity in that sentence?

It says:
Quote:
(B) when short-term rates rise and they are unable to raise


In this sentence, B clearly refers to short-term rates, not to banks still you have marked this as the right answer. Pathetic response from the community on this one. Disappointing.
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Re: Since savings banks have to use short-term deposits to finance long-te  [#permalink]

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New post 29 Apr 2018, 22:55
Though B is more concise than C, the reason I chose C was because C was parallel and B was not ("rise" and "raise").
Can somebody throw more light on this?????????????
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Re: Since savings banks have to use short-term deposits to finance long-te  [#permalink]

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New post 30 Apr 2018, 02:54
suramya26 wrote:
Though B is more concise than C, the reason I chose C was because C was parallel and B was not ("rise" and "raise").

Hi suramya26, believe it or not, in B, the parallelism is between rise and are (both of them verbs)

Not only is C not as concise, it changes the meaning of the original sentence. It says:

.....there is no rise possible in the rates on their mortgages.

So, C does not state who cannot raise the rates on their mortgages. The original sentence says that the banks cannot raise the rates on their mortgages.

So, C changes the meaning of the original sentence.
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Re: Since savings banks have to use short-term deposits to finance long-te  [#permalink]

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New post 25 Sep 2018, 20:23
1
ajit257 wrote:
Since savings banks have to use short-term deposits to finance long-term fixed-rate mortgage loans, they sometimes lose money when there is a rise in short-term rates and, on the other hand, they are unable to raise the rates on their mortgages.

(A) when there is a rise in short-term rates and, on the other hand, they are unable to raise
(B) when short-term rates rise and they are unable to raise
(C) when a rise in short-term rates occurs and, correspondingly, there is no rise possible in
(D) with a rise in short-term rates, and they are unable to raise
(E) with short-term rates on the rise and no rise possible in


They loose money ..... they are unable to raise ... too much ambiguity over pronoun "they" in option B?
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Re: Since savings banks have to use short-term deposits to finance long-te  [#permalink]

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New post 26 Sep 2018, 01:10
i am confused.
is this from official source. ?
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Re: Since savings banks have to use short-term deposits to finance long-te  [#permalink]

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New post 26 Sep 2018, 04:55
I think B would have been correct if
(B) when short-term rates rise , and they are unable to raise
we are joining two independent clauses so we need ", and"
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Re: Since savings banks have to use short-term deposits to finance long-te &nbs [#permalink] 26 Sep 2018, 04:55
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