Loans extended from banks to individuals can allow individuals to take

Question

Which of the following most logically completes the argument?

Loans extended from banks to individuals can allow individuals to take well-measured financial risks or pay off existing debts that carry higher interest rates. However, more aggressive banks extend freely to individuals loans that are too large for those individuals to pay back foreseeably, causing other problems. Therefore, the creation of a new department to monitor and restrict banks would benefit public well-being, since _______________.

A. the new department would aim to restrict only aggressive lending

B. aggressive banks cause individuals to establish less overall debt than credit card companies do

C. other banks, while not aggressive, may still ultimately extend more total dollars in loans to individuals than aggressive banks

D. the loans of aggressive banks to borrowers other than individuals, such as businesses, can also cause problems

E. other measures to curb aggressive banks might have the inadvertent effect of preventing deserving individuals from getting the loans they need

This is a  CR Butler Question

Check the links to other Butler Projects:

Data Sufficiency Butler  
  Problem Solving Butler  
  Reading Comprehension Butler  
  Data Insights Butler

akhilsundar422 · Answer

E? Other options don't seem plausible.

Ann321 · Answer

Hey  Bunuel , kindly provide official explanation.

Su1206 · Answer

This question does not sound like one we typically see on GMAT.

Bunuel · Answer

Official Explanation

Reading the question: we see that we have logical completion exercise. If more than one answer choice seems like a logical continuation, there will be clues in the sentence that make one logical continuation more logical, objectively superior to the other ones.

Creating a filter: the blank is part of the conclusion of the argument, marked by the word "therefore," but it comes after the word "since." It's a piece of evidence mentioned within the conclusion. Most logically, it will not introduce a random new piece of evidence, but will rearticulate the evidence that has been given above. Specifically, it will do so in the context of the conclusion sentence--in terms of the recommendation for the new department. So what belongs in the bank is something about how this new department is a great idea because right now the some loans are great, but others are harmful, and the situation is uncontrolled. So we expect something in the blank like "needs control."

Applying the filter: which answer choices are in line with that prediction? Too many, we find. We need to be more specific. What needs controlling? The bad banks, specifically. (A) matches that. (A) is in. (B) seems to match that, but then introduces credit cards out of nowhere, so (B) is out. (C) does not focus on the bad banks and is out. (D) focuses on bad banks, but a different practice they have other than what we are talking about, so it's out. (E) is fairly logical, especially after (B) through (D). But (E) really gives a reason why establishing a new department is a better way of curbing bad banks than other ways. That's not material to the conclusion, which is that establishing the new department "would benefit public well-being." (E) skips the point by saying that the new department would be avoid side problems without talking about why it would be good for its aim.

The correct answer is (A).

Loans extended from banks to individuals can allow individuals to take

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

Loans extended from banks to individuals can allow individuals to take

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