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655-705 (Hard)|   Inference|      
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Bunuel
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In Nurica, investors who believe they are the victims of malpractice 19 Jan 2024, 14:28
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E
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!

Difficulty:

55% (hard)

Question Stats:

69% (02:23) correct 31% (02:29) wrong based on 290 sessions

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In Nurica, investors who believe they are the victims of malpractice by their financial advisors can file a claim with a government agency. The agency arbitrates the dispute unless a settlement is reached before the hearing date. Of those claims that reached the arbitration stage, a smaller proportion resulted in restitution for the investor in 1995 than in 1994. Nonetheless, a larger proportion of all the claims filed resulted in restitution in 1995 than in 1994.

Which of the following is most strongly supported by the information given?

A. The proportion of claims filed that were unfounded was higher in 1995 than in 1994.
B. The average amount awarded to investors whose claims were arbitrated by the agency was lower in 1995 than in 1994
C. The average amount of restitution for settlement was higher in 1995 than in 1994
D. There were fewer arbitrators available to hear claims in 1995 than in 1994
E. A larger proportion of claims settled prior to arbitration resulted in restitution in 1995 than in 1994
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E
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Shuvojoti
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In Nurica, investors who believe they are the victims of malpractice 21 Jan 2024, 00:44
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Can any expert explain the reason for choosing E over C, please?

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Samya2113
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In Nurica, investors who believe they are the victims of malpractice 18 Jul 2024, 05:11
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Bunuel
In Nurica, investors who believe they are the victims of malpractice by their financial advisors can file a claim with a government agency. The agency arbitrates the dispute unless a settlement is reached before the hearing date. Of those claims that reached the arbitration stage, a smaller proportion resulted in restitution for the investor in 1995 than in 1994. Nonetheless, a larger proportion of all the claims filed resulted in restitution in 1995 than in 1994.

Which of the following is most strongly supported by the information given?

A. The proportion of claims filed that were unfounded was higher in 1995 than in 1994.
B. The average amount awarded to investors whose claims were arbitrated by the agency was lower in 1995 than in 1994
C. The average amount of restitution for settlement was higher in 1995 than in 1994
D. There were fewer arbitrators available to hear claims in 1995 than in 1994
E. A larger proportion of claims settled prior to arbitration resulted in restitution in 1995 than in 1994
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­b_sudharsan
Can you please explain how to approach this problem and arrive at E?

Thank you!
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In Nurica, investors who believe they are the victims of malpractice 19 Jul 2024, 08:54
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Samya2113

Bunuel
In Nurica, investors who believe they are the victims of malpractice by their financial advisors can file a claim with a government agency. The agency arbitrates the dispute unless a settlement is reached before the hearing date. Of those claims that reached the arbitration stage, a smaller proportion resulted in restitution for the investor in 1995 than in 1994. Nonetheless, a larger proportion of all the claims filed resulted in restitution in 1995 than in 1994.

Which of the following is most strongly supported by the information given?

A. The proportion of claims filed that were unfounded was higher in 1995 than in 1994.
B. The average amount awarded to investors whose claims were arbitrated by the agency was lower in 1995 than in 1994
C. The average amount of restitution for settlement was higher in 1995 than in 1994
D. There were fewer arbitrators available to hear claims in 1995 than in 1994
E. A larger proportion of claims settled prior to arbitration resulted in restitution in 1995 than in 1994
­b_sudharsan
Can you please explain how to approach this problem and arrive at E?

Thank you!
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­To solve this question, let us deploy IMS's four-step technique. 

STEP #1 -> IDENTIFY THE QUESTION TYPE

Let us read the question stem to identify the question type. The stem, 'Which of the following is most strongly supported by the information given?' indicates an inference question.

Now that the question type is identified, let us proceed to the second step. 

STEP #2 -> X-RAY THE ARGUMENT

In an inference question, it is a must to x-ray the argument. Let us therefore read the argument and state the facts mentioned as we read. 

FACT #1 -> In Nurica, investors who believe they are the victims of malpractice by their financial advisors can file a claim with a government agency.
FACT #2 -> The agency arbitrates the dispute unless a settlement is reached before the hearing date.
FACT #3 -> Of those claims that reached the arbitration stage, a smaller proportion resulted in restitution for the investor in 1995 than in 1994.
FACT #4 -> Nonetheless, a larger proportion of all the claims filed resulted in restitution in 1995 than in 1994.

For the sake of convenience, let us say a total of 1000 claims were filed in both 1994 and 1995. Since a larger proportion of all the claims filed resulted in restitution in 1995 than in 1994, let us say 600 of the 1000 claims filed resulted in restitution in 1995 as opposed to 200 in 1994. Also, fact #3 says a smaller proportion of those claims that reached the arbitration stage resulted in restitution for the investor in 1995 than in 1994. Again, let us say 700 claims reached the arbitration stage in both 1994 and 1995, but in 1995, only 100 out of these resulted in restitution as opposed to 150 in 1994. 

Let us do a fact check now. 

Of those claims that reached the arbitration stage (700), a smaller proportion resulted in restitution for the investor in 1995 (100) than in 1994 (150).   (100/700<150/700)  :thumbsup:
A larger proportion of all the claims (1000) filed resulted in restitution in 1995 (600) than in 1994 (200).  (600/1000>200/1000)  :thumbsup:

Now that the argument is x-rayed, let us proceed to the third step.

STEP #3 -> FRAME A SHADOW ANSWER

In an inference question, the correct answer must be 100 percent validated by the facts mentioned in the passage. 

SHADOW ANSWER: An option that is fully validated by the stated facts. 

Now that we know what the right answer should do, let us proceed to the final step. 

STEP #4 -> PROCESS OF ELIMINATION

A. The proportion of claims filed that were unfounded was higher in 1995 than in 1994. - NOT A MATCH - There is no info regarding unfounded claims. - ELIMINATE

B. The average amount awarded to investors whose claims were arbitrated by the agency was lower in 1995 than in 1994. - NOT A MATCH - There is no info regarding the amount awarded to investors. - ELIMINATE

C. The average amount of restitution for settlement was higher in 1995 than in 1994 - NOT A MATCH - There is no info regarding the amount of restitution for settlement. - ELIMINATE

D. There were fewer arbitrators available to hear claims in 1995 than in 1994. - NOT A MATCH - Again, there is no info regarding the number of arbitrators. - ELIMINATE

E. A larger proportion of claims settled prior to arbitration resulted in restitution in 1995 than in 1994 - MATCHES THE SHADOW ANSWER -  While x-raying the argument, we came up with some numbers. Let us now consider them. 

1995 
Total number of claims filed - 1000
Claims that resulted in restitution - 600
Number of claims that reached arbitration - 700
Number of claims that resulted in restitution after arbitration - 100
We know 600 claims resulted in restitution. We can infer than 500 of these 600 claims (600 - 100) were settled before arbitration.

1994
Total number of claims filed - 1000
Claims that resulted in restitution - 200
Number of claims that reached arbitration - 700
Number of claims that resulted in restitution after arbitration - 150
We know 200 claims resulted in restitution. We can infer than 50 of these 200 (200-150) claims were settled before arbitration.

Our workings above indicate that a larger proportion of claims settled prior to arbitration resulted in restitution in 1995 than in 1994. (500/600>50/200) - MARK AND MOVE

Hence, (E) is the right answer. 
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