Xavier: The new fast-food place on 10th Street is out of business alre

Question

Xavier: The new fast-food place on 10th Street is out of business already. I'm not surprised. It had no indoor seating, and few people want to sit outside and breathe exhaust fumes while they eat.

Miranda: The bank should have realized that with all the fast-food places on 10th Street, one lacking indoor seating was likely to fail. So it was irresponsible of them to lend the money for it.

It can be inferred from the dialogue that Xavier and Miranda agree that

A. few people want to sit outside while they eat

B. banks should not finance restaurants lacking indoor seating

C. if the new fast-food place had indoor seating, it probably would have been successful

D. a fast-food place on 10th Street is likely to fail if it has any outdoor seating

E. the new fast-food place on 10th Street was a risky venture

unraveled · Answer

Xavier: The new fast-food place on 10th Street is out of business already. I'm not surprised. It had no indoor seating, and few people want to sit outside and breathe exhaust fumes while they eat.

Miranda: The bank should have realized that with all the fast-food places on 10th Street, one lacking indoor seating was likely to fail. So it was irresponsible of them to lend the money for it.

It can be inferred from the dialogue that Xavier and Miranda agree that

A. few people want to sit outside while they eat - WORNG. Only X says anything about sitting outside.

B. banks should not finance restaurants lacking indoor seating - WORNG. Only M says about banks.

C. if the new fast-food place had indoor seating, it probably would have been successful - WRONG. 2nd best but contra positive of what is stated in the passage is not necessarily true.

D. a fast-food place on 10th Street is likely to fail  if it has any outdoor seating  - WRONG. The conditionality goes against the choice.

E. the new fast-food place on 10th Street  was a risky venture  - CORRECT. POE helps actually. Risk and failure are same.

Answer E.

arushi118 · Answer

Can you please explain - that none of them talk explicitly about the new business being a risky venture - so why not A?

guddo · Answer

E

Both of them treat “no indoor seating” as a major red flag that made failure likely. If failure was likely, then the venture was risky.

A is only Xavier’s claim. Miranda never says “few people want to sit outside” or anything equivalent. She talks about what the bank should have predicted, given competition on 10th Street and the lack of indoor seating.

E is supported by both: both say the lack of indoor seating made failure likely. “Likely to fail” is exactly what “risky venture” means, even if they do not use the word “risky.”

Sajjad1994 · Answer

Explanation

Xavier:  New fast-food place failed because it had no indoor seating and people don’t want to sit outside breathing exhaust fumes.
 Miranda:  The bank should have realized that with all the fast-food places on 10th Street, one lacking indoor seating was likely to fail, so lending money was irresponsible.

They both believe lack of indoor seating was a cause of failure. They both imply the failure was foreseeable, so the bank shouldn’t have lent money.

A.  Only Xavier says this but Miranda doesn’t directly confirm this belief; it’s part of Xavier’s reasoning, but it’s not clearly the shared inference.

B.  This option is exeggeration. Miranda thinks lending for this specific case was irresponsible, but does that mean banks should never finance any restaurant lacking indoor seating?

C.  This is tempting. Implying the opposite by illegical construction. They never say this. There could be other reasons it could fail even with indoor seating.

D.  This is a distortion. Similar to  (B) .

E.   Yes! they both believe it was likely to fail because of no indoor seating, so lending to it was risky; Miranda calls it irresponsible lending because the risk was clear. This matches their shared view without overgeneralizing.

Answer: E

kumarvibhuti630 · Answer

Explanations:

A. Incorrect, Miranda didn't agree on this, as she is opposing lack of indoor seating

B. Incorrect, Xavier didn't comment on finances

C. Incorrect, No comment related to sucess from both

D. Incorrect, Both oppose only lack of indoor seating, even if there is any outdoor sitting it won't be an issue for them.

E. Correct, Both agrees that restaurant will likely fail.

egmat · Answer

WHY NOT A?   
 (A)  Few people want to sit outside while they eat

WHAT XAVIER SAYS: 
"Few people want to sit outside  and breathe exhaust fumes "

→ He's talking about  10th Street specifically  (busy, polluted)
→ He's NOT saying people hate outdoor seating everywhere
→ A is  TOO BROAD

WHAT MIRANDA SAYS: 
"With  all the fast-food places  on 10th Street, one  lacking indoor seating  was likely to fail"

→ Her reasoning is about  COMPETITION 
→ On a crowded street with many options, customers will pick the place that has  MORE features

Miranda's logic: 
• People might  LOVE  outdoor seating
• But they also want the  OPTION  to sit inside
• If Restaurant A has both options and Restaurant B has only outdoor → people pick A
• Not because they hate outdoor, but because they want  CHOICE

Miranda never says people dislike outdoor seating!

SIMPLE ANALOGY 
 "With all the phone stores nearby, a store selling ONLY iPhones was likely to fail."

Does this mean people hate iPhones?  NO!

It means: In a competitive market, customers want  OPTIONS .

WHY E IS CORRECT 
  (E)  The new fast-food place was a risky venture

Xavier:  "Not surprised" → He saw failure coming
 Miranda:  "Likely to fail" → She saw failure coming

Different reasons. Same conclusion:  RISKY VENTURE  ✓

Answer: E

Xavier: The new fast-food place on 10th Street is out of business alre

Prep Toolkit

Top 5 GMAT Debrief Videos

615 to 715 in 15 Days (Ria's Strategies)

More than Quant/Verbal Abilities: Speed vs. Accuracy

745 with Only Self-Prep and GMAT Club

From 555 to 765: 210-point Improvement

Perfect 805 Score Debrief by Julia

My Rewards

GMAT Critical Reasoning (CR) Questions

Xavier: The new fast-food place on 10th Street is out of business alre

Prep Toolkit

615 to 715 in 15 Days (Ria's Strategies)

More than Quant/Verbal Abilities: Speed vs. Accuracy

745 with Only Self-Prep and GMAT Club

From 555 to 765: 210-point Improvement

Perfect 805 Score Debrief by Julia

My Rewards