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Re: The investment firm OTSI specializes in making investments for its [#permalink]
Can someone explain why D is wrong?
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Re: The investment firm OTSI specializes in making investments for its [#permalink]
The investment firm OTSI specializes in making investments for its clients in particular foreign stock markets. OTSI's investment decisions in the Nadurian stock market have been particularly well judged it increased its clients' investments in that market just before each major market rise and decreased their investments just before each major fall. Clearly, therefore, any investor wanting to make money in the Nadurian market will do well by investing with OTSI.

Which of the following, if true, most seriously weakens the argument?

A. The analyst at OTSI who was responsible for making investments in the Nadurian market has just left the company
B. Over the years that OTSI has been investing in the Nadurian market, the balance of rises and falls in that market have resulted in a substantial overall rise.
C. OTSI has been almost as successful with investments in other foreign stock markets as it has been with investments in the Nadurian market.
D. Some of OTSI competitors have been almost as successful as OTSI with their investments in the Nadurian market.
E. During the period that OTSI has been investing in the Nadurian market, stock markets in some other countries have risen far more than the Nadurian market has.

A straightforward argument. The passage talks about an investment company that does well in certain stock markets abroad - especially in Country N's stock market by buying and selling at the right time. And therefore, if you're looking to make money in stocks in Country N, you should go with this investment company.

We're asked, however, to look for something that goes against this.

(A) is the answer. Ultimately, if the person who was actually making the decisions about when to buy and sell in Country N just left, who is to say that the replacement analyst would be just as good? The real value of investing through this company could have been this person who was a genius - not because of the company itself necessarily. Imagine you have a restaurant you really like going to because the food is amazing. Then you find out the chef has gone to another establishment. Are you still going to go to the original restaurant? Perhaps not.
 
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Re: The investment firm OTSI specializes in making investments for its [#permalink]
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Vartika2525 wrote:
Can someone explain why D is wrong?

­(D) says that OTSI's competitors have been almost as successful as OTSI with their investments in the Nadurian market. That implies that OTSI did BETTER than its competitors! And even if the competitors did just as well as OTSI, that wouldn't change the fact that OTSI also did well.

The conclusion is that any investor wanting to make money in the Nadurian market will do well by investing with OTSI. What happened with the competition doesn't change what happened with OTSI: they did well in the past, so we expect them to do well in the future (even if competitors also do well).

(A) is a much better answer -- if we lose the person responsible for the past success, then we have no reason to expect that the success will continue.

I hope that helps!­
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Re: The investment firm OTSI specializes in making investments for its [#permalink]
GMATNinja can you please explain why B is wrong? Maybe I focused on the wrong part of the conclusion. I was torn between A and B, but ultimately chose B because B says that performing well in the market is not due to OTSI's investment choices.
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Re: The investment firm OTSI specializes in making investments for its [#permalink]
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