Question: Local phone companies have monopolies on phone service within their areas. Cable television can be transmitted via the wires that are already in place and owned by the phone companies. Cable television companies argue that if the telephone companies were to offer cable service, these telephone companies would have an unfair advantage, because their cable transmissions could be subsidized by the profits of their monopolies on phone service.
On the basis of the information provided in the passage above, which of the following questions can be answered?
(A) Are phone companies as efficient as cable companies in providing reliable and inexpensive service?
(B) If phone companies were allowed to provide cable service, would they want to do so?
(C) Do the cable companies believe that the local phone companies make a profit on phone service?
(D) Are local phone companies forbidden to offer cable service?
(E) Is it expected that phone companies will have a monopoly on cable service?
“Local phone companies have monopolies on phone service within their areas” - is a GMAT critical reasoning topic. This GMAT critical consists of five options and the candidates must select the right option that justifies the passage argument. GMAT critical reasoning focuses on measuring the logical skills of the candidates. The candidate can look for evidence that would weaken the argument or can hold logical flaws in the argument in order to respond to the question. The candidates had to answer 36 MCQ questions in this GMAT critical reasoning section and the candidate must do it in 65 minutes.
Answer: (C)
Explanation:
This GMAT Critical Reasoning passage is based on an Inference type of question. The candidate needs to derive critical reasoning from the evidence or premises of the passage. The candidate must detect the facts from the given argument and lead to a conclusion. The candidates must speculate and imply a possible answer out of those five answers in order to satisfy the argument of the passage. For example, an answer that rules out a secondary cause might read: “ The television firms offer cable service and gain an unfair benefit due to the profits yielded from the monopoly of the phone companies.”
Option (A): Wrong
This does not support the argument of the passage as it is mentioned nowhere in the passage. The candidate cannot give an answer to this question by reading the passage argument.
Option (B): Wrong
This is irrelevant to the given argument of the passage. Therefore, it is a wrong answer as it does not meet the passage discussion.
Option (C): Correct
This question can be answered since the cable companies argue that the profits yielded from the monopoly of the telephone companies would gain an unfair benefit to telephone companies. Therefore, it is the correct answer as it supports the argument of the passage.
Option (D): Wrong
The candidate cannot answer this question since it is irrelevant to the argument of the passage. The facts of this question are not mentioned anywhere in the passage.
Option (E): Wrong
This does not support the passage argument since no expectations about past events or the future are not inferred in the passage. Therefore, it is irrelevant and thereby gets eliminated.
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