Pundit: If the Federal Reserve chairman keeps interest ... ...
If the pundit's statements are true, which of the following can be concluded?
(A) It is unlikely that an asset bubble will develop.
(B) ...
(C) ...
(D) ...
(E) ...
*This question is included in
Exercise Set 1: Intro to Conditionals
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Posted: 03/07/2012 08:19
It says if the chairman keeps interest rates excessively low for a decade. The answer that was chosen as the correct one states that interest rates be excessively low for MORE than a decade. This is why I said none of the above
Contributor
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Posted: 03/07/2012 14:05
Oge, thanks for using the app and the post. If the interest rates have been kept excessively low for MORE than a decade, then it is the more reason for an asset bubble to develop.
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Posted: 03/07/2012 18:20
The original statement presents a sentence that indicates a maximum amount of time in years for the asset bubble to develop (keep interest rates excessively low for a decade). The answer choice presents a solution that indicates a minimum amount of time in years for the asset bubble to develop (keeps interest rates excessively low for MORE than a decade)
Reply 1 of 1
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Posted: 04/14/2012 00:44
I agree with you oge I also chose Choice E, because the correct answer stated "more" than a year, and that is never mentioned in the previous statement.
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Posted: 04/28/2012 12:28
How is it not B? They stated that the asset bubble would be in place if interest rates are keep excessively low for a decade but they finished with it would be there if there was such a thing of a assets bubble meaning there isn't such a bubble. But interest rates were low. Answer B is more then likely interest rates were low
Admin
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Posted: 04/30/2012 14:03
Diagram the statements:
I. (IR is kept low for 10 years) --> AB
The contrapositive: ~ AB --> ~ (IR is kept low for 10 years)
II. AB --> indicators for AB
~ indicators for AB --> ~ AB
Work out the conclusion:
From the 2nd statement's contrapositive, we conclude there is no indicator for AB, which means there is no AB.
Apply this to the first statement's contrapositive: If there is no AB, then it is not true that interest rates have been kept low for 10 years.
Now, I know the choice C says "... for more than 10 years" instead of just "... for 10 years". I wish the question author hadn't done it.
However, from the statement we know that if keeping the IR low for even longer will make the AB develop even more.