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Recently in City X, developers have stopped buying land, contractors h

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Recently in City X, developers have stopped buying land, contractors h  [#permalink]

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New post 19 Feb 2015, 00:03
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This question is part of the GMAT Club Critical Reasoning: "Weaken an argument" revision Project.

Recently in City X, developers have stopped buying land, contractors have found themselves going without work for longer periods, and banks have issued fewer mortgages. There must be fewer new residents moving to City X than there were previously. Which of the following indicates a flaw in the reasoning above?

A. This year several housing blocks have gone on the market after being held up for months by legal red tape.

B. The average size of a new home has increased significantly over the past several years.

C. Re-sales of condominiums have increased over the past six months.

D. The cost of materials such as lumber and cement has decreased over the past year.

E. Sales of other big-ticket items, such as automobiles and boats, has remained steady over the past year.

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Re: Recently in City X, developers have stopped buying land, contractors h  [#permalink]

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New post 19 Feb 2015, 07:57
IMO - A
Stopping of developments and fewer bank mortgages = less number of new residents
so we must find an evidence which gives an alternate explanation for the situation and i think (A) does that .
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Re: Recently in City X, developers have stopped buying land, contractors h  [#permalink]

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New post 19 Feb 2015, 21:58
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souvik101990 wrote:
This question is part of the GMAT Club Critical Reasoning: "Weaken an argument" revision Project.

Recently in City X, developers have stopped buying land, contractors have found themselves going without work for longer periods, and banks have issued fewer mortgages. There must be fewer new residents moving to City X than there were previously. Which of the following indicates a flaw in the reasoning above?

A. This year several housing blocks have gone on the market after being held up for months by legal red tape.

B. The average size of a new home has increased significantly over the past several years.

C. Re-sales of condominiums have increased over the past six months.

D. The cost of materials such as lumber and cement has decreased over the past year.

E. Sales of other big-ticket items, such as automobiles and boats, has remained steady over the past year.


There are some problems in this question but nevertheless answer is (A).

Premises:

Developers have stopped buying land,
Contractors have found themselves going without work for longer periods,
Banks have issued fewer mortgages.
(So fewer homes are getting constructed and bought)

Conclusion: There must be fewer new residents moving to City X than there were previously.

A. This year several housing blocks have gone on the market after being held up for months by legal red tape.
Many previously built housing units which were on hold have flooded the market leading to oversupply. Hence, it explain that developers and contractors are out of work. But it doesn't address the banks issuing fewer mortgages. With the banks in the picture, the argument shows us that fewer people are buying houses. The conclusion is that fewer new people are coming to city X. There could have been a much better weakener which explains that people are not buying houses because of the reduced rents or something similar. But this does go on to explain a part of the situation (fewer homes are getting constructed) so in case there is no other better option, we will go with this.

B. The average size of a new home has increased significantly over the past several years.
Size of the homes is out of scope. We are only concerned about the number of homes.

C. Re-sales of condominiums have increased over the past six months.
You might think that this explains why developers and contractors are out of work since new people could be buying old houses but people who are selling their houses would need new houses in this case. Hence it does not explain developers, contractors and bankers out of work. It doesn't weaken our conclusion much except if most people had multiple homes and are selling out of those. In that case, it would be similar to option (A) where it would explain fewer new constructions. But expecting most people to have multiple homes is too much of an assumption. So option (A) is better.

D. The cost of materials such as lumber and cement has decreased over the past year.
This should encourage more construction, not less. Hence, not relevant.

E. Sales of other big-ticket items, such as automobiles and boats, has remained steady over the past year.
Out of scope. Perhaps people have started buying more automobiles and boats, we don't know. The relation between homes and other big ticket items is not known.

Answer (A)
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Re: Recently in City X, developers have stopped buying land, contractors h  [#permalink]

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New post 08 May 2017, 05:03
Hello VeritasPrepKarishma,

Thank you for the explanation. Though I chose A (since it seemed more refined than C), I am still not convinced with explanation to discard C.

My reasoning was C talks about past 6 months and the stem talks about "recently". We don't know recent this "recently" could be. It could be past 2 months with C being true in that time frame.

A plays it safe and does not mention any time reference.

any thoughts? GMATNinja, GMATNinjaTwo?
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Re: Recently in City X, developers have stopped buying land, contractors h  [#permalink]

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New post 08 May 2017, 07:02
warriorguy wrote:
Hello VeritasPrepKarishma,

Thank you for the explanation. Though I chose A (since it seemed more refined than C), I am still not convinced with explanation to discard C.

My reasoning was C talks about past 6 months and the stem talks about "recently". We don't know recent this "recently" could be. It could be past 2 months with C being true in that time frame.

A plays it safe and does not mention any time reference.

any thoughts? GMATNinja, GMATNinjaTwo?


I wouldn't use that logic. The argument uses the word "recently". Option (A) uses "this year" and option (C) uses "6 months". We don't know what recently means so both could be assumed to be recent.

The problem with (C) is that it doesn't make sense with the argument. The conclusion is derived based on certain conditions of today. A weakener would give an alternative to the conclusion which would explain the conditions and hence reduce the probability of the conclusion being true.

Option (A) explains the situation faced by contractors and developers, but it doesn't explain why banks are issuing fewer mortgages.
Option (C) doesn't explain the situation faced by all - contractors, developers and bankers. If resale increases, people who are selling their house would need to buy a new house hence the contractors and developers should not be out of work. Also, whenever buying happens - new house or old - mortgages will be issued.

Hence (C) will not be the answer.
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Re: Recently in City X, developers have stopped buying land, contractors h  [#permalink]

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New post 20 Jun 2017, 17:57
VeritasPrepKarishma wrote:
souvik101990 wrote:
This question is part of the GMAT Club Critical Reasoning: "Weaken an argument" revision Project.

Recently in City X, developers have stopped buying land, contractors have found themselves going without work for longer periods, and banks have issued fewer mortgages. There must be fewer new residents moving to City X than there were previously. Which of the following indicates a flaw in the reasoning above?

A. This year several housing blocks have gone on the market after being held up for months by legal red tape.

B. The average size of a new home has increased significantly over the past several years.

C. Re-sales of condominiums have increased over the past six months.

D. The cost of materials such as lumber and cement has decreased over the past year.

E. Sales of other big-ticket items, such as automobiles and boats, has remained steady over the past year.


There are some problems in this question but nevertheless answer is (A).

Premises:

Developers have stopped buying land,
Contractors have found themselves going without work for longer periods,
Banks have issued fewer mortgages.
(So fewer homes are getting constructed and bought)

Conclusion: There must be fewer new residents moving to City X than there were previously.

A. This year several housing blocks have gone on the market after being held up for months by legal red tape.
Many previously built housing units which were on hold have flooded the market leading to oversupply. Hence, it explain that developers and contractors are out of work. But it doesn't address the banks issuing fewer mortgages. With the banks in the picture, the argument shows us that fewer people are buying houses. The conclusion is that fewer new people are coming to city X. There could have been a much better weakener which explains that people are not buying houses because of the reduced rents or something similar. But this does go on to explain a part of the situation (fewer homes are getting constructed) so in case there is no other better option, we will go with this.

B. The average size of a new home has increased significantly over the past several years.
Size of the homes is out of scope. We are only concerned about the number of homes.

C. Re-sales of condominiums have increased over the past six months.
You might think that this explains why developers and contractors are out of work since new people could be buying old houses but people who are selling their houses would need new houses in this case. Hence it does not explain developers, contractors and bankers out of work. It doesn't weaken our conclusion much except if most people had multiple homes and are selling out of those. In that case, it would be similar to option (A) where it would explain fewer new constructions. But expecting most people to have multiple homes is too much of an assumption. So option (A) is better.

D. The cost of materials such as lumber and cement has decreased over the past year.
This should encourage more construction, not less. Hence, not relevant.

E. Sales of other big-ticket items, such as automobiles and boats, has remained steady over the past year.
Out of scope. Perhaps people have started buying more automobiles and boats, we don't know. The relation between homes and other big ticket items is not known.
Answer (A)


Please correct me if my logic is wrong, but the conclusion is "There must be fewer new residents moving to City X", and I think C does better job than other to weaken the conclusion (even there is a weakness in it). It doesn't matter if the ones who sold their old houses need new house or not or not, there are still many NEW RESIDENTs come to city X as they bought these old houses (The weakness of this Ans is of course there is possibility that the current residents bought those houses. But, we can not deny the high possibility that many NEW RESIDENTS bought those house and then the NEW RESIDENTS of city X increase→ weaken the conclusion)

The option A says " This year several housing blocks have gone on the market ", but does it mean that many houses were bought?? No right? Those houses were just released on the market "after being held up for months by legal red tape". Then how can we say that the are more NEW RESIDENTS come to city X, as we do not know that those house were purchased or not?
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Re: Recently in City X, developers have stopped buying land, contractors h  [#permalink]

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New post 21 Jun 2017, 01:41
Labmalo wrote:
Please correct me if my logic is wrong, but the conclusion is "There must be fewer new residents moving to City X", and I think C does better job than other to weaken the conclusion (even there is a weakness in it). It doesn't matter if the ones who sold their old houses need new house or not or not, there are still many NEW RESIDENTs come to city X as they bought these old houses (The weakness of this Ans is of course there is possibility that the current residents bought those houses. But, we can not deny the high possibility that many NEW RESIDENTS bought those house and then the NEW RESIDENTS of city X increase→ weaken the conclusion)

The option A says " This year several housing blocks have gone on the market ", but does it mean that many houses were bought?? No right? Those houses were just released on the market "after being held up for months by legal red tape". Then how can we say that the are more NEW RESIDENTS come to city X, as we do not know that those house were purchased or not?


A is correct (out of the given options). Whether the new houses were bought or not, doesn't matter. The point is they increased the supply and hence the builders stopped building new houses. So builders being out of work may have nothing to do with how many new residents moved to City X. Perhaps many moved but there was enough supply of houses in the market.

On the other hand, (C) says that resale has increased. Note that it doesn't say that more new houses are on the market. It says that resale has increased. So people are selling their houses for whatever reason. They could be upgrading/downgrading according to their needs. It doesn't explain why builders are not building anymore and why banks are issuing fewer mortgages.
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Re: Recently in City X, developers have stopped buying land, contractors h  [#permalink]

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New post 21 Jun 2017, 02:08
VeritasPrepKarishma wrote:
Labmalo wrote:
Please correct me if my logic is wrong, but the conclusion is "There must be fewer new residents moving to City X", and I think C does better job than other to weaken the conclusion (even there is a weakness in it). It doesn't matter if the ones who sold their old houses need new house or not or not, there are still many NEW RESIDENTs come to city X as they bought these old houses (The weakness of this Ans is of course there is possibility that the current residents bought those houses. But, we can not deny the high possibility that many NEW RESIDENTS bought those house and then the NEW RESIDENTS of city X increase→ weaken the conclusion)

The option A says " This year several housing blocks have gone on the market ", but does it mean that many houses were bought?? No right? Those houses were just released on the market "after being held up for months by legal red tape". Then how can we say that the are more NEW RESIDENTS come to city X, as we do not know that those house were purchased or not?


A is correct (out of the given options). Whether the new houses were bought or not, doesn't matter. The point is they increased the supply and hence the builders stopped building new houses. So builders being out of work may have nothing to do with how many new residents moved to City X. Perhaps many moved but there was enough supply of houses in the market.

On the other hand, (C) says that resale has increased. Note that it doesn't say that more new houses are on the market. It says that resale has increased. So people are selling their houses for whatever reason. They could be upgrading/downgrading according to their needs. It doesn't explain why builders are not building anymore and why banks are issuing fewer mortgages.


Thank you, I read again the argument and got it now. The conclusion here is made based on the the fact that many new buildings are not constructed. Hence the answer should be relevant to that logic as well. Agree with A now.
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Re: Recently in City X, developers have stopped buying land, contractors h  [#permalink]

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New post 21 Jun 2017, 07:55
Imo A
Recently in City X, developers have stopped buying land, contractors have found themselves going without work for longer periods, and banks have issued fewer mortgages. There must be fewer new residents moving to City X than there were previously. Which of the following indicates a flaw in the reasoning above?

A. This year several housing blocks have gone on the market after being held up for months by legal red tape.

B. The average size of a new home has increased significantly over the past several years. Irrelevant

C. Re-sales of condominiums have increased over the past six months. Weaken but A is much better

D. The cost of materials such as lumber and cement has decreased over the past year. Out of scope

E. Sales of other big-ticket items, such as automobiles and boats, has remained steady over the past year. Out of scope
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Re: Recently in City X, developers have stopped buying land, contractors h  [#permalink]

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New post 25 Jun 2017, 04:31
VeritasPrepKarishma wrote:
Labmalo wrote:
Please correct me if my logic is wrong, but the conclusion is "There must be fewer new residents moving to City X", and I think C does better job than other to weaken the conclusion (even there is a weakness in it). It doesn't matter if the ones who sold their old houses need new house or not or not, there are still many NEW RESIDENTs come to city X as they bought these old houses (The weakness of this Ans is of course there is possibility that the current residents bought those houses. But, we can not deny the high possibility that many NEW RESIDENTS bought those house and then the NEW RESIDENTS of city X increase→ weaken the conclusion)

The option A says " This year several housing blocks have gone on the market ", but does it mean that many houses were bought?? No right? Those houses were just released on the market "after being held up for months by legal red tape". Then how can we say that the are more NEW RESIDENTS come to city X, as we do not know that those house were purchased or not?


A is correct (out of the given options). Whether the new houses were bought or not, doesn't matter. The point is they increased the supply and hence the builders stopped building new houses. So builders being out of work may have nothing to do with how many new residents moved to City X. Perhaps many moved but there was enough supply of houses in the market.

On the other hand, (C) says that resale has increased. Note that it doesn't say that more new houses are on the market. It says that resale has increased. So people are selling their houses for whatever reason. They could be upgrading/downgrading according to their needs. It doesn't explain why builders are not building anymore and why banks are issuing fewer mortgages.


For us to believe that C is wrong we have to assume that developers and contractors are needed to resell the house. I thought they weren't required once the house has been built and hence they would be out of work! i am rather confused!
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Re: Recently in City X, developers have stopped buying land, contractors h  [#permalink]

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New post 30 Jun 2017, 02:04
I thought B is the answer because bigger size means more people stay in one house and therefore, fewer houses are constructed. I was wrong because B talks about the average size, not all sizes of all houses.
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Re: Recently in City X, developers have stopped buying land, contractors h  [#permalink]

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New post 31 Jul 2017, 11:31
I chose the correct answer (A), but still find option (C) plausible: let's assume the number of residents moving into city X hasn't changed, but the number of people leaving city X has increased and those people are selling their houses, which in turn are bought by people moving into city X=> hence, less demand for new housing as there is an increasing stock of houses on a secondary market despite the same number of people moving to city X. Where is my logic wrong?
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Re: Recently in City X, developers have stopped buying land, contractors h  [#permalink]

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