An influential stock analyst recommends the purchase

Question

An influential stock analyst recommends the purchase of three infrequently traded stocks in each of his weekly magazine columns. Unusually large amounts of these stocks are often purchased one day before the magazine appears on the newsstands. This pattern has recurred over a five-year period.

Suppose that the information presented above is accurate. Each of the following statements, if true, could help to explain why the unusually large purchases occurred EXCEPT:

(A) Workers at the company that prints the magazine have used their advance knowledge of the analyst’s column to guide their own stock purchases.

(B) Workers at the company that prints the magazine often sell advance copies of the magazine to stockbrokers.

(C) One hundred copies of each issue of the magazine are circulated in the publishing company’s office a day before the issue appears on newsstands.

(D) The analyst refuses to submit his column for editorial review before it is printed.

(E) Twenty people in the publishing company have access to the analyst’s column before it is printed

ID 05442

kzivrev · Answer

I did answered correctly but tough call between A and D. I do think that A could be correct as well, but this is an official question so need to accept as is. anyway for A to be rulled out GMAC assumes that these workers did read the column while they were printing ( working), so isint going into too deep of assumptions in order to rule out A. on another question GMAC may say well workers could read but it is not for sure. On the other side if we do this and the will say that is incorrect you are assuming beyond, and they penalize you with wrong answer on the test. so when they want they can assume beyond but not we. This is open for manipulation and debate, this is really why I hate this test. lots of gray areas particularly on the verbal side.

any thoughts on this?

any thoughts on this?

ynk · Answer

Here are my views--

Option 'A' cannot be a contender here as it clearly says that workers use their advance knowledge of analysts after reading the columnist article,that means they can be held responsible for buying stocks after reading the article of the columnist and before it gets published as they will have access to it.

Here,Option 'D' is a clear winner.

Also,talking about the GMAT Test overall,yes you are right that it does have that grey area but then its effects are not huge and further you will be compared with other students who will also be facing the same test and same issues so nothing to worry on that part.Just give your best.

kzivrev · Answer

as I already have mentioned, A is open for debate depending from what perspective you are looking at. What is the job of a printing worker, he prints what ever is assigned to be printed, is he going to have time to read it or not is questionable. I have never heard of a printing worker to have to read the material before printing, it is simply not his job, there are other employees hired to to that job, that is why I think that this is debatable area. instead of printing workerr they could have said editors, or linguist or anyone whose job is to proof read the material. Printing worker is very close call and that call is the gray area, at one case is acceptable in the other they (GMAC) would say no no no you are assuming too much.

By the way this is the Official Explanation from GMAC for A:
" The workers's purchases based on their advance knowledge could account for the pattern"

Hmmmm.... we need to asssume that they have read the column. But in the wake of the time pressure to try not to over-assume this can be a trick answer. at first I thought I dont want to assume too much, but than I saw D and said to my self D is a stronger contender.

paidlukkha · Answer

Experts, please comment if my reasoning is correct

P large amounts of infrequently traded stocks are often purchased one day before the magazine appears on the newsstands 
C pattern has recurred over a five-year period
A - possible, large amounts & workers purchase justified
B - workers to stickbrokers - justified
C - again circulated to workers - justified 
D - Analyst refuses, so no one knows before its printed out -  Answer 
E - 20 people have access - possibility they will purchase or have stockbrokers purchase on their behalf - justified

VerbalBot · Answer

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An influential stock analyst recommends the purchase

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