GMAT Question of the Day - Daily to your Mailbox; hard ones only

It is currently 26 May 2019, 16:20

Close

GMAT Club Daily Prep

Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track
Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.

Close

Request Expert Reply

Confirm Cancel

The function of capital markets is to facilitate an exchange of funds

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
TAGS:

Hide Tags

 
Senior Manager
Senior Manager
User avatar
G
Joined: 03 Mar 2017
Posts: 291
Reviews Badge CAT Tests
Re: The function of capital markets is to facilitate an exchange of funds  [#permalink]

Show Tags

New post 01 Jul 2018, 22:37
GMATNinja mikemcgarry

278. The author’s main point is argued by

(A) giving examples that support a conventional generalization
(B) showing that the view opposite to the author’s is self-contradictory
(C) criticizing the presuppositions of a proposed plan
(D) showing that omissions in a theoretical description make it inapplicable in certain cases
(E) demonstrating that an alternative hypothesis more closely fits the data


I marked the answer C.
Isn't the author criticizing the presuppositions of a proposed plan??
The last paragraph says that a lot of assumptions are made by financial market studies and the author is clearly criticizing these assumptions.

Could you please help.
_________________
--------------------------------------------------------------------------------------------------------------------------
All the Gods, All the Heavens, and All the Hells lie within you.
GMAT Club Verbal Expert
User avatar
P
Status: GMAT and GRE tutor
Joined: 13 Aug 2009
Posts: 2490
Location: United States
GMAT 1: 780 Q51 V46
GMAT 2: 800 Q51 V51
GRE 1: Q170 V170
Re: The function of capital markets is to facilitate an exchange of funds  [#permalink]

Show Tags

New post 20 Jul 2018, 12:53
Boomshockalocka wrote:
GMATNinja

Hi GMATNinja, could you please explain 278? I chose B but the answer is D.


Quote:
278. The author’s main point is argued by

(B) showing that the view opposite to the author’s is self-contradictory

Quote:
For B, "The function of capital markets is to facilitate an exchange of funds among all participants, and yet in practice we find that certain participants are not on a par with others." this sentence indicates that the view opposite to the author's is self-contradictory. Doesn't it?

In this sentence, the author makes a statement (in practice, certain participants are not on par with others) which contradicts the opposing view. This is a case of one person (the author) contradicting another (anyone who believes conventional financial analysis). This is not a case of self-contradiction, which would require the opposition to contradict their own logic or their own statements.

Quote:
278. The author’s main point is argued by

(D) showing that omissions in a theoretical description make it inapplicable in certain cases

Quote:
And I don't understand why D is correct. What is the intended "theoretical description"? And what are those "certain cases"?

The "theoretical description" is that capital markets facilitate an exchange of funds among all participants. This is a conventional view of market participation, and the author disagrees with this conventional view because it omits many cases (i.e. minority communities) wherein capital markets fail to fulfill their functions.

Thinking about this structurally, we see that in the first paragraph, the author declares that the conventional theory about capital markets is inaccurate. In the second paragraph, the author shows cases that are omitted by this conventional theory, and therefore can't be explained by that theory. In the third paragraph, the author explains the assumptions that lead to these cases' being omitted during conventional analysis. This structure matches the language in choice (D), and since we've eliminated every other answer choice, (D) is our best answer.

I hope that helps!
_________________
GMAT Club Verbal Expert | GMAT/GRE tutor @ www.gmatninja.com (Now hiring!) | Instagram | Food blog | Notoriously bad at PMs

Beginners' guides to GMAT verbal
Reading Comprehension | Critical Reasoning | Sentence Correction

YouTube LIVE verbal webinars
Series 1: Fundamentals of SC & CR | Series 2: Developing a Winning GMAT Mindset

SC & CR Questions of the Day (QOTDs), featuring expert explanations
All QOTDs | Subscribe via email | RSS

Need an expert reply?
Hit the request verbal experts' reply button -- and please be specific about your question. Feel free to tag @GMATNinja in your post. Priority is always given to official GMAT questions.

Sentence Correction articles & resources
How to go from great (760) to incredible (780) on GMAT SC | That "-ing" Word Probably Isn't a Verb | That "-ed" Word Might Not Be a Verb, Either | No-BS Guide to GMAT Idioms | "Being" is not the enemy | WTF is "that" doing in my sentence?

Reading Comprehension, Critical Reasoning, and other articles & resources
All GMAT Ninja articles on GMAT Club | Using LSAT for GMAT CR & RC |7 reasons why your actual GMAT scores don't match your practice test scores | How to get 4 additional "fake" GMAT Prep tests for $29.99 | Time management on verbal
RC Moderator
User avatar
V
Joined: 24 Aug 2016
Posts: 804
Location: Canada
Concentration: Entrepreneurship, Operations
GMAT 1: 630 Q48 V28
GMAT 2: 540 Q49 V16
GMAT ToolKit User Premium Member Reviews Badge CAT Tests
Re: The function of capital markets is to facilitate an exchange of funds  [#permalink]

Show Tags

New post 06 Nov 2018, 15:55
1
Hello workout , bb , NaeemHasan or who ever has the OG10 or OG11 : At 2nd para ---- The existing system expresses definite socially based investment preferences that result from the previous allocation of income and that influence the allocation of resources for the present and future.

Is 'based' used in the actual book ? I am not sure why I am thinking 'biased' . - may be confused between the uses - 'society based' vs 'socially biased' !!
_________________
Please let me know if I am going in wrong direction.
Thanks in appreciation.
Manager
Manager
User avatar
S
Joined: 06 Oct 2015
Posts: 91
Location: Bangladesh
Concentration: Accounting, Leadership
Re: The function of capital markets is to facilitate an exchange of funds  [#permalink]

Show Tags

New post 07 Nov 2018, 05:02
u1983 wrote:
Hello workout , bb , NaeemHasan or who ever has the OG10 or OG11 : At 2nd para ---- The existing system expresses definite socially based investment preferences that result from the previous allocation of income and that influence the allocation of resources for the present and future.

Is 'based' used in the actual book ? I am not sure why I am thinking 'biased' . - may be confused between the uses - 'society based' vs 'socially biased' !!

Yes, it is. Socially based. I have the soft copy and I have checked again.
RC Moderator
User avatar
V
Joined: 24 Aug 2016
Posts: 804
Location: Canada
Concentration: Entrepreneurship, Operations
GMAT 1: 630 Q48 V28
GMAT 2: 540 Q49 V16
GMAT ToolKit User Premium Member Reviews Badge CAT Tests
Re: The function of capital markets is to facilitate an exchange of funds  [#permalink]

Show Tags

New post 07 Nov 2018, 05:07
NaeemHasan wrote:
u1983 wrote:
Hello workout , bb , NaeemHasan or who ever has the OG10 or OG11 : At 2nd para ---- The existing system expresses definite socially based investment preferences that result from the previous allocation of income and that influence the allocation of resources for the present and future.

Is 'based' used in the actual book ? I am not sure why I am thinking 'biased' . - may be confused between the uses - 'society based' vs 'socially biased' !!

Yes, it is. Socially based. I have the soft copy and I have checked again.



Oh ok ..... Thanks a bunch for confirming NaeemHasan ...... sorry for the trouble.
_________________
Please let me know if I am going in wrong direction.
Thanks in appreciation.
Founder
Founder
User avatar
V
Joined: 04 Dec 2002
Posts: 17541
Location: United States (WA)
GMAT 1: 750 Q49 V42
GPA: 3.5
GMAT ToolKit User Premium Member CAT Tests
Re: The function of capital markets is to facilitate an exchange of funds  [#permalink]

Show Tags

New post 09 Nov 2018, 12:17
u1983 wrote:
Hello workout , bb , NaeemHasan or who ever has the OG10 or OG11 : At 2nd para ---- The existing system expresses definite socially based investment preferences that result from the previous allocation of income and that influence the allocation of resources for the present and future.

Is 'based' used in the actual book ? I am not sure why I am thinking 'biased' . - may be confused between the uses - 'society based' vs 'socially biased' !!



I have a hard copy and I can confirm that it "based" - correct as written currently.
Thanks for actively reading and thx for asking!
_________________
Founder of GMAT Club

Just starting out with GMAT? Start here...
New! OG2020 Directory !
Want to know application stats & Profiles from last year? Check the Decision Tracker

Co-author of the GMAT Club tests
Intern
Intern
avatar
B
Joined: 31 Jul 2018
Posts: 15
CAT Tests
Re: The function of capital markets is to facilitate an exchange of funds  [#permalink]

Show Tags

New post 10 Apr 2019, 18:43
jennpt Question 278. How would you figure out A vs D
Manager
Manager
avatar
B
Joined: 12 Nov 2018
Posts: 102
CAT Tests
Re: The function of capital markets is to facilitate an exchange of funds  [#permalink]

Show Tags

New post 10 Apr 2019, 23:37
Took 13mins to do it,Q1,2 and 3 incorrect.

How did you guys do it in 6mins?
Manager
Manager
User avatar
B
Joined: 29 Dec 2013
Posts: 69
GMAT 1: 770 Q48 V51
Re: The function of capital markets is to facilitate an exchange of funds  [#permalink]

Show Tags

New post 16 Apr 2019, 14:12
1
Hi gmat8998

Interesting question. For this one, I might first summarize in my head what I think the argument is. Did you do this?

Here is my summary per paragraph: P1: Capital markets don't actually help everyone evenly. P2: Example of how capital markets are screwed up and unfair in US minority communities. P3: Most theoretical analysis of capital markets assumes a bunch of things that aren't true in reality.

OK. So what is the main theme?
My version: Capital markets don't actually work in reality the way they do/should do in theory.

But is there ever one sentence in the passage that says this main theme? NO. I had to summarize it across the main ideas of the three paragraphs.

So if we consider (A) giving examples that support a conventional generalization
Um, what conventional generalization would we be talking about? Remember, conventional means usual/typical/accepted/mainstream. But if there is any conventional generalization here, it would be that capital markets work in a certain (predictable/textbook) way, and our author is actually arguing AGAINST that, not to SUPPORT it.

So let's look at (D) showing that omissions in a theoretical description make it inapplicable in certain cases
Sounds good to me. The author shows that there are holes/gaps/missing parts in the theory that mean the theory actually cannot describe what is truly going on in certain cases - for example, in US minority communities.

Let me know how you were thinking and if this makes it clearer, please.
_________________
Professional GMAT Coach with students on 6 continents

New: I've recently launched Bright Outlook Global Prep, helping candidates achieve their higher education goals. We offer classes and private consultation, online and in our Berlin base. Let's get to work!

Personal 99th percentile score (770), including V51. Based in Berlin and previously in Paris, ich spreche auch deutsch/je parle aussi français.
With five years' experience, I am expert in coaching non-native speakers to outstanding performance.
Intern
Intern
avatar
B
Joined: 31 Jul 2018
Posts: 15
CAT Tests
Re: The function of capital markets is to facilitate an exchange of funds  [#permalink]

Show Tags

New post 16 Apr 2019, 14:29
jennpt Hi .. Yeah I did summarize individual paras but couldn't decipher the main idea as close as you have. Also,conventional generalization is something i couldn't understand.
Really good analysis this! Hard to come up with a main point with such precision. Thanks.
Manager
Manager
User avatar
B
Joined: 04 Dec 2015
Posts: 97
WE: Operations (Commercial Banking)
Re: The function of capital markets is to facilitate an exchange of funds  [#permalink]

Show Tags

New post 19 Apr 2019, 16:30
great passage! Got 6/7 // still have to practice more! GMATNinja Thank you for this -----> https://gmatclub.com/forum/experts-topi ... l#p1857560
GMAT Club Bot
Re: The function of capital markets is to facilitate an exchange of funds   [#permalink] 19 Apr 2019, 16:30

Go to page   Previous    1   2   [ 31 posts ] 

Display posts from previous: Sort by

The function of capital markets is to facilitate an exchange of funds

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  


Copyright

GMAT Club MBA Forum Home| About| Terms and Conditions and Privacy Policy| GMAT Club Rules| Contact| Sitemap

Powered by phpBB © phpBB Group | Emoji artwork provided by EmojiOne

Kindly note that the GMAT® test is a registered trademark of the Graduate Management Admission Council®, and this site has neither been reviewed nor endorsed by GMAC®.