Exports of United States wood pulp will rise considerably during this year. The reason for the rise is that the falling value of the dollar will make it cheaper for paper manufacturers in Japan and Western Europe to buy American wood pulp than to get it from any other source.
(This question is from Official Guide. Therefore, because of copyrights, the complete question cannot be copied here. The question can be accessed at GMAT Club)
Exports of United States wood pulp will rise considerably during this year.
We’re given a prediction. Exports of US wood pulp will rise.
The reason for the rise is that the falling value of the dollar will make it cheaper for paper manufacturers in Japan and Western Europe to buy American wood pulp than to get it from any other source.
This statement gives us the reason for the prediction. Value of the dollar is falling. Thus, Japanese and European paper manufacturers will find it cheaper to buy from the U.S. than from elsewhere. (If you want an explanation for why this will happen, let us know. We’ll be happy to help.)
Gist: Since paper manufacturers of other countries will find it the cheapest to buy wood pulp from the US (support), exports of US wood pulp will rise (conclusion).
The missing link is: will the devaluation of the American dollar lead to higher exports? The argument assumes that if US wood pulp is the cheapest, foreign paper manufacturers will buy more.
Thus, the argument also makes the following underlying assumptions:
- Paper manufacturers are fine with the US wood pulp in all other regards – such as quality.
- These paper manufacturers will continue to have a demand for wood pulp this year.
- These paper manufacturers need wood pulp as raw material and do not have other viable alternatives.
We have already discussed a couple of assumptions above. As always, there could be others as well.
(A) Incorrect. It is not necessary that manufacturers will increase output this year to conclude that exports of US wood pulp will rise. Even if the factory output remains the same or even declines, the argument will hold.
(B) Correct. This is certainly an assumption the argument is making. If the quality is not adequate, irrespective of the price drop, these manufacturers will not buy from the US sellers. That will destroy the conclusion that exports of US wood pulp will rise.
(C) Incorrect. The argument says that the manufacturers will prefer US wood pulp because it will be the cheapest for them. It is not necessary that the manufacturers would prefer it even if cost were not a factor. The argument does not rest on this statement.
The option does support the conclusion. And that might attract many people to it. But, remember an assumption will not only support (or defend), but also be necessary for the conclusion to hold. This option is not necessary.
(D) Incorrect. Why would this be necessary? If demand increases sharply (negation of the given statement), perhaps the manufacturers will buy even higher quantities from the US. Thus, the negation rather seems to support the argument.
If the test-makers wanted to make things more difficult, they’d have said:
Demand for paper products made in Japan and Western Europe will not decrease sharply during this year.
Try to evaluate this statement for a bit.
This one comes quite close but still is not necessary. We do not know the buying patterns of the manufacturers. Do they buy in advance? Will they still buy for the future because of low cost? The demand for the end-product does not necessarily tell us about the demand for the raw material. Even this statement would not be necessary.
(E) Incorrect. This statement does not support the argument. It, in fact, weakens the argument. If the production will not increase sharply, perhaps exports will not increase.
How about if we negate this option?
Negated option: ‘Production of wood pulp by US companies will increase sharply during this year’.
Does this statement now become an assumption for the argument?
This negated option does support the argument. However, even this statement is not necessary to conclude that exports of US wood pulp will rise. Exports may happen at the cost of domestic sales.
Option C highlights a very important aspect of assumption questions. The correct option will not only support but also be necessary for the conclusion. An option that only supports will be wrong. This is a key difference between a strengthen and an assumption question.
“during this year”
This phrase might seem awkward but is just fine. During is used with a period of time. And ‘this year’ is indeed a period of time.
How about the phrase ‘during 1969’? This phrase sounds right, right? We could very well replace the year 1969 with ‘this year’.
“if cost were not a factor”
When dealing with hypothetical conditionals, we use ‘were’ even with singular subjects. Here ‘cost’ is singular, yet ‘were’ is correct.
Note: such usage is only for hypothetical situations. When dealing with a possibility that might be true, use ‘was’ as usual with a singular subject.
Correct: If I were tall, I would play basketball. – hypothetical
Correct: If he was at fault, he will get punished. – possibility
This solution was created by Anish Passi and Chiranjeev Singh.
If you have any doubts regarding any part of this solution, please feel free to ask in the comments section.