Question: An electric-power company gained greater profits and provided electricity to consumers at lower rates per unit of electricity by building larger-capacity more efficient plants and by stimulating greater use of electricity within its area. To continue these financial trends, the company planned to replace an old plant by a plant with triple the capacity of its largest plant.

The company's plan as described above assumed each of the following EXCEPT:

1. Demand for electricity within the company's area of service would increase in the future.
2. Expenses would not rise beyond the level that could be compensated for by efficiency or volume of operation, or both.
3. The planned plant would be sufficiently reliable in service to contribute a net financial benefit to the company as a whole.
4. Safety measures to be instituted for the new plant would be the same as those for the plant it would replace.
5. The tripling of capacity would not result in insuperable technological obstacles to efficiency.

Answer: D
Explanation:
The GMAT's critical reasoning portion will evaluate your capacity for analysis and critical thought. A person needs to have high cognitive abilities to respond clearly.
To reach a decision, each option must be critically examined. Of the five options provided, only one will be accurate. The candidate must evaluate many factors to make the best decision.
Let’s check the given choices -

A: Incorrect
It is an incorrect choice. This is a reasonable assumption to make. Why? Because there won't be any growth in the profit if there isn't a corresponding rise in the amount of electricity that is demanded. Consequently, there is a need for a rise in the demand for power. Hence, it is eliminated.

B: Incorrect
It is the wrong choice. This is a reasonable assumption to make. Why? Because if the expenses continue to climb above the level that might be paid by the level of operating efficiency, volume, or both, then the profit that is obtained will continue to decrease. Therefore, it is necessary for us to assume that the costs will not exceed a particular threshold. Hence this choice is eliminated.

C: Incorrect
It is an incorrect answer. This is a reasonable assumption to make. Why? Because this choice suggests providing additional advantages to the business as a whole, which is an assumption that ought to be considered reasonable. Hence it is eliminated.

D: Correct
It is the correct answer. This is an incorrect assumption to make. Concerning the amount of money that can be made by the new facility, we have a great deal of anxiety. Therefore, there is no reason for us to make any presumptions regarding the preventative actions. This is the option that should be chosen as the correct response given that we are searching for one that does not involve a prerequisite assumption.

E: Incorrect
It is an incorrect choice. This is a reasonable assumption to make. Why? because if tripling the capacity would have a negative impact on efficiency, then increasing the profit would be impossible in such a scenario. Therefore, it is imperative that there be no problem that impacts the effectiveness of the plant. This choice is eliminated.

“An electric-power company gained greater profits and provided electric” – is a GMAT Critical question. To answer the question, a candidate can either find a piece of evidence that would weaken the argument or have logical flaws in the argument. GMAT critical reasoning tests the logical and analytical skills of the candidates. This topic requires candidates to find the argument's strengths and weaknesses or the logical flaw in the argument. The GMAT CR section contains 10 -13 GMAT critical reasoning questions out of 36 GMAT verbal questions.

Suggested GMAT Critical Reasoning Questions

• Jane drinks 4 Cups of Coffee Every Day. GMAT critical reasoning
• Johnson is on Firm Ground When he Asserts that the Early Editors of Dickinsons Poetry Often Distorted her Intentions GMAT critical reasoning
• One Reason why European Music has had Such a Strong Influence Throughout the World GMAT critical reasoning
• The Elk City Garbage Dumps are so Full that Elk City has Been Forced to Pay a Large Sum to Caribou City to Accept much of Elk City’s Garbage. GMAT critical reasoning
• Turtles, like Other Reptiles, can Endure Long Fasts, in their Ability to Survive on Weekly GMAT critical reasoning
• A Diet High in Saturated Fats Increases a Person's Risk of Developing Heart Disease GMAT critical reasoning
• At An Enormous Research Cost A Leading Chemical Company Has Developed GMAT Critical Reasoning
• A Reliable Survey Indicates That College Graduates Change Employers Four Times GMAT Critical Reasoning
• In 1988, a significant percentage of seals in the Baltic Sea died GMAT Critical Reasoning
• Contrary to the charges made by some of its opponents GMAT Critical Reasoning
• A Year After The Start An Experiment To Decrease Crime GMAT Critical Reasoning
• Since the invention of digital readout, machine designers have rushed GMAT Critical Reasoning
• The President of a Consulting Firm Analysed the Decisions Made About Marketing GMAT Critical Reasoning
• Many companies have been pushing for a three-week extension of daylight GMAT Critical Reasoning
• In All Mammalian Species, the Period of a Young Mammal’s Life GMAT Critical Reasoning
• Manufacturers of household appliances are still urging the public to purchase food processors GMAT critical reasoning
• Contrary to the Statements of Labour Leaders, the Central Economic Problem GMAT Critical Reasoning
• From time to time, the press indulges in outbursts of indignation over GMAT Critical Reasoning
• Exhaust released from a combustion engine is harmful when breathed in significant quantities.GMAT Critical Reasoning
• The tax system of the Republic of Grootland encourages borrowing by granting its taxpayers GMAT Critical Reasoning
• Advances in photocopying technology allow criminals with no printing expertise GMAT Critical Reasoning
• Professor A: We must make a strong moral statement against Country X’s policies GMAT Critical Reasoning
• According to an Independent Computer-Industry Analyst, the New Regent Microcomputer GMAT Critical Reasoning
• In Today’s Pluralistic Society, Textbook Publishers Find Themselves in an Increasingly Uncomfortable Position GMAT Critical Reasoning
• Economies in which a high percentage of resources are invested in research and development GMAT Critical Reasoning
• Columnist: The country is presently debating legislation GMAT Critical Reasoning
• When People Evade Income Taxes by not Declaring Taxable Income GMAT Critical Reasoning
• Utrania was formerly a major petroleum exporter, but in recent decades economic stagnation GMAT Critical Reasoning
• Useful protein drugs, such as insulin, must still be administered by the cumbersome GMAT Critical Reasoning
• Unripe Lychee Fruit Contain a Compound called Hypoglycin GMAT Critical Reasoning
• Tiger Beetles are such Fast Runners that they can Capture Virtually any Nonflying Insect GMAT Critical Reasoning
• According to a recent study, retirees in the United States are four times more likely to give regular financial aid to their children as to receive it from them GMAT Critical Reasoning
• Roland: The alarming fact is that 90 percent of the people in this country now report that they know someone who is unemployed GMAT Critical Reasoning
• TOMMY: That telephone always rings when I am in the shower and can’t hear it GMAT Critical Reasoning
• A major network news organisation experienced a drop in viewership in the week GMAT Critical Reasoning
• It is Difficult to Keep Deep Wounds Free of Bacteria GMAT Critical Reasoning
• Carol is Shorter Than Juan, But She is Taller than Ed. Sandra is Shorter than Juan, and She is Shorter than Ed GMAT critical reasoning
• Ethicist: It Would be a Mistake to Say that Just Because Someone is Inclined to do Otherwise GMAT critical reasoning
• According to a study, after a week of high-altitude living, twenty men had slimmed down. GMAT critical reasoning
• Shelby Industries Manufactures and Sells the Same Gauges as Jones Industries. GMAT critical reasoning
• Building a space station, in which astronauts would live for a considerable time GMAT critical reasoning
• The interview is an essential part of a successful hiring program because, with it, job applicants who have personalities that are unsuited to the requirements of the job will be eliminated from consideration. GMAT critical reasoning
• According to a recent study, retirees in the United States are four times more likely to give regular financial aid to their children as to receive it from them. GMAT critical reasoning
• Using oil-based paints to paint walls or furniture requires the use of turpentine and each coat takes a long time to dry.GMAT critical reasoning
• President of the United States: I have Received over 2,000 Letters on this Issue, and the Vast Majority of them Support my Current Position. GMAT critical reasoning
• Roland: The alarming fact is that 90 percent of the people in this country now report that they know someone who is unemployed. GMAT critical reasoning
• TOMMY: That telephone always rings when I am in the shower and can’t hear it. GMAT critical reasoning
• A major network news organization experienced a drop in viewership in the week GMAT critical reasoning
• Experienced pilots often have more trouble than novice pilots in learning to fly GMAT critical reasoning
• It is Difficult to Keep Deep Wounds Free of Bacteria. GMAT critical reasoning