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# What is the assumption of the author?

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Manager
Joined: 13 May 2017
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Location: Finland
Concentration: Accounting, Entrepreneurship
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WE: Account Management (Entertainment and Sports)
What is the assumption of the author?  [#permalink]

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07 Jan 2018, 05:21
Fear of shortage of supplies leads to price increase. Since the crisis of Libya started, the price of oil has gone up. Therefore, with the crisis spreading to more oil producing nations in Africa, the price of oil will rise further in the western regions.

A. African oil producing nations satisfy majority of the oil needs of the west.

B. The crisis in Libya has impacted oil production in Libya.

C. The current crisis in African nations that produce oil will instill fear of shortage of oil in the western regions
Manager
Joined: 17 Mar 2015
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Re: What is the assumption of the author?  [#permalink]

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07 Jan 2018, 05:48
1
rencsee wrote:
Fear of shortage of supplies leads to price increase. Since the crisis of Libya started, the price of oil has gone up. Therefore, with the crisis spreading to more oil producing nations in Africa, the price of oil will rise further in the western regions.

A. African oil producing nations satisfy majority of the oil needs of the west.

B. The crisis in Libya has impacted oil production in Libya.

C. The current crisis in African nations that produce oil will instill fear of shortage of oil in the western regions

Would go with C:

A: even if African oil producing nation do not satisfy majority of oil needs of west it does not prove anything. Even if there is problem with minor oil supplying nations, it may instill fear of supply.

B: No relation with actual production. The author is just talking about the fear of supply not actual supply.

Please give Kudos if the explanation is helpful !!!!!!!!!!!!!!!!!!!!!!!!!!!!
Manager
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Re: What is the assumption of the author?  [#permalink]

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08 Jan 2018, 05:12
can someone please help me with this question. Am a little confused with option A.See the argument is saying that decrease in supply leads to increase in price and that since there is crisis in Libya that is going to lead to decreased supply and that in turn will lead to increase in oil price and the conclusion states that since this crisis is going to spread to the African nations , There is going to be a increase in oil price. My forethought says that decrease in supply leads to increase in price provided there is demand for the product. Since option A is just restating the fact that African nations satisfy the needs of the west and so they are the major oil suppliers i thought that this has to be the correct answer. Please help
Manager
Joined: 13 May 2017
Posts: 115
Location: Finland
Concentration: Accounting, Entrepreneurship
GMAT 1: 530 Q42 V22
GMAT 2: 570 Q36 V31
GMAT 3: 600 Q42 V28
GPA: 3.14
WE: Account Management (Entertainment and Sports)
Re: What is the assumption of the author?  [#permalink]

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13 Jan 2018, 16:09
1
Hi longhaul123,
The correct answer choice is the one which if we negate, will break down the conclusion.

* fear of shortage -> price increase
* crisis in Libya -> oil price increase
=> crisis in Africa -> fear of shortage -> increased price of oil in West

Assuming the African oil producing nation satisfy only 49% and not the majority won’t beak down the conclusion. In fact it doesn’t matter if African oil supply majority or minority of western region. It is not stated in the passage what influence does either case have on the West. Therefore, A. can’t be the correct assumption.

On the other hand, at answer C. If we assume that the current African crisis won’t instill fear of shortage, it clearly breaks down the conclusion. No fear of shortage -> no oil price increase can be predicted.

Hope it helps.
Reni

Sent from my iPad using GMAT Club Forum
Manager
Status: IF YOU CAN DREAM IT, YOU CAN DO IT
Joined: 03 Jul 2017
Posts: 187
Location: India
Concentration: Finance, International Business
Re: What is the assumption of the author?  [#permalink]

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03 Feb 2018, 20:03
I have one question here. So can one of the assumptions of the author be that the western countries and the African oil producing nations are related to each other, meaning that the premise talks about the oil producing nations in Africa where as the conclusion is about the western regions and so the change in price in the western region should be connected with the African oil producing nations.
Please correct me if I'm wrong. Thank you
Re: What is the assumption of the author?   [#permalink] 03 Feb 2018, 20:03
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# What is the assumption of the author?

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