A prominent investor who holds a large stake in the Burton Tool company has recently claimed that the company is...

GMAT Critical Reasoning : (CR) Questions

Source: Official Guide

Critical Reasoning

Boldface

MEDIUM

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A prominent investor who holds a large stake in the Burton Tool company has recently claimed that the company is mismanaged, citing as evidence the company's failure to slow production in response to a recent rise in its inventory of finished products. It is doubtful whether an investor's sniping at management can ever be anything other than counterproductive, but in this case it is clearly not justified. It is true that an increased inventory of finished products often indicates that production is outstripping demand, but in Burton's case it indicates no such thing. Rather, the increase in inventory is entirely attributable to products that have already been assigned to orders received from customers.

In the argument given, the two boldfaced portions play which of the following roles?

The first states the position that the argument as a whole opposes; the second provides evidence to undermine the support for the position being opposed.

The first states the position that the argument as a whole opposes; the second is evidence that has been used to support the position being opposed.

The first states the position that the argument as a whole opposes; the second states the conclusion of the argument as a whole.

The first is evidence that has been used to support a position that the argument as a whole opposes; the second provides information to undermine the force of that evidence.

The first is evidence that has been used to support a position that the argument as a whole opposes; the second states the conclusion of the argument as a whole.

Solution

Understanding the Passage

Text from Passage	Analysis
"A prominent investor who holds a large stake in the Burton Tool company has recently claimed that"	What it says: An investor who owns a significant portion of Burton Tool company has made a public statement about the company. Visualization: Investor owns say 15% of Burton Tool shares → Makes public claim about company management What it does: Sets up who is making the criticism that will follow Source: Author reporting factual information
(Boldface 1) "the company is mismanaged"	What it says: The investor believes Burton Tool is being run poorly by its management. Visualization: Normal management quality: 7/10 → Investor claims: 3/10 management quality What it does: Presents the investor's main accusation against the company Source: Investor's view (being reported by author)
"citing as evidence the company's failure to slow production in response to a recent rise in its inventory of finished products"	What it says: The investor points to a specific problem - Burton kept making products even though they had more finished goods sitting in storage than before. Visualization: January inventory: 1000 units → March inventory: 1500 units, but production rate stayed at 100 units/day instead of reducing to 75 units/day What it does: Provides the investor's reasoning for why he thinks the company is mismanaged Source: Investor's view (being reported by author)
"It is doubtful whether an investor's sniping at management can ever be anything other than counterproductive, but"	What it says: The author questions whether investors criticizing management ever helps anything, suggesting it usually hurts. Visualization: Investor criticism → Company stress increases → Management distraction → Performance drops from 80% to 70% What it does: Shows the author's general skepticism about investor criticism while setting up a contrast Source: Author's view
(Boldface 2) "in this case it is clearly not justified"	What it says: The author states that this particular investor's criticism of Burton Tool is definitely wrong and unwarranted. Visualization: Investor's criticism validity: 0/10 → Author's assessment: Completely unjustified What it does: Presents the author's main conclusion that directly opposes the investor's claim Source: Author's view
"It is true that an increased inventory of finished products often indicates that production is outstripping demand, but in Burton's case it indicates no such thing"	What it says: The author admits the investor's general logic is usually correct (more inventory often means making too much), but says Burton's situation is different. Visualization: Typical case: Demand 800 units/month, Production 1000 units/month → Excess inventory. Burton's case: Different reason for inventory increase What it does: Acknowledges the investor's reasoning while preparing to refute it Source: Author's view
"Rather, the increase in inventory is entirely attributable to products that have already been assigned to orders received from customers"	What it says: The real reason Burton has more inventory is because these finished products are already sold to customers who ordered them. Visualization: Burton inventory: 1500 units total → 1450 units already assigned to customer orders → Only 50 units actually unsold What it does: Provides the evidence that proves the investor's criticism is wrong Source: Author's view

Overall Structure

The author is rejecting an investor's criticism by providing alternative evidence. The flow: Investor claims mismanagement → Author disagrees → Author explains why the investor's evidence doesn't support his conclusion.

Main Conclusion: The investor's claim that Burton Tool is mismanaged is not justified.

Boldface Segments

Boldface 1: the company is mismanaged
Boldface 2: in this case it is clearly not justified

Boldface Understanding

Boldface 1:
- Function: This is the investor's main accusation against Burton Tool
- Direction: Opposite direction - this opposes the author's ultimate position since the author argues this claim is unjustified

Boldface 2:
- Function: This is the author's main conclusion rejecting the investor's criticism
- Direction: Same direction - this directly supports the author's ultimate position

Structural Classification

Boldface 1:
- Structural Role: A claim that the author argues against (opposing position)
- Predicted Answer Patterns: "a claim that the argument disputes" or "a position that the author argues is incorrect"

Boldface 2:
- Structural Role: The main conclusion of the author's argument
- Predicted Answer Patterns: "the conclusion of the argument" or "the author's main claim"

Answer Choices Explained

The first states the position that the argument as a whole opposes; the second provides evidence to undermine the support for the position being opposed.

"The first states the position that the argument as a whole opposes" - ✓ CORRECT - The mismanagement claim is what the author argues against throughout
"the second provides evidence to undermine the support for the position being opposed" - ✗ WRONG - Boldface 2 is the conclusion itself, not evidence. The evidence comes after Boldface 2 when the author explains about inventory being assigned to customer orders

The first states the position that the argument as a whole opposes; the second is evidence that has been used to support the position being opposed.

"The first states the position that the argument as a whole opposes" - ✓ CORRECT - The author clearly disagrees with the mismanagement claim
"the second is evidence that has been used to support the position being opposed" - ✗ WRONG - Boldface 2 contradicts the investor's position rather than supporting it, and it's a conclusion statement, not evidence

The first states the position that the argument as a whole opposes; the second states the conclusion of the argument as a whole.

"The first states the position that the argument as a whole opposes" - ✓ CORRECT - The author spends the entire argument refuting the mismanagement claim
"the second states the conclusion of the argument as a whole" - ✓ CORRECT - "It is clearly not justified" is the author's main takeaway message rejecting the investor's criticism

The first is evidence that has been used to support a position that the argument as a whole opposes; the second provides information to undermine the force of that evidence.

"The first is evidence that has been used to support a position that the argument as a whole opposes" - ✗ WRONG - Boldface 1 is not evidence but rather the main claim itself that the investor is making
"the second provides information to undermine the force of that evidence" - ✗ WRONG - Boldface 2 is a conclusion statement, not information or evidence

The first is evidence that has been used to support a position that the argument as a whole opposes; the second states the conclusion of the argument as a whole.

"The first is evidence that has been used to support a position that the argument as a whole opposes" - ✗ WRONG - Boldface 1 is the investor's main accusation, not evidence supporting something else
"the second states the conclusion of the argument as a whole" - ✓ CORRECT - This part accurately identifies Boldface 2's role

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