Logical ReasoningDifficulty: Easy

PT23 S3 Q2 Explanation

Owners of deeply indebted and chronically unprofitable

A free, expert breakdown of this official LSAT Logical Reasoning question.

TopicsParadox

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Stimulus

Owners of deeply indebted and chronically unprofitable small businesses sometimes try to convince others to invest money in their companies. Since the money thus acquired will inevitably be used to pay off debts, rather than to expand operations, this money will not stimulate sales growth in such companies. Thus, most people are earn handsome returns in the very first year they are made.

What this question is testing

Paradox

Your task

Break the argument into its conclusion and evidence, then do exactly what the question stem asks with that structure.

Common trap

Answers that sound relevant to the topic but don't connect to the argument's actual reasoning.

Winning move

Predict what a right answer must do, then test each choice against the conclusion-evidence gap.

Reading along? Open the full official question in LawHub — we show a fragment here and keep the reasoning in our own words.

The question
2.

Which one of the following, if true, most helps to explain the surprising results

Answer choices

  1. Trap2% picked this

    Investors usually choose to reinvest their returns on

  2. Trap0% picked this

    Expanding production in such companies would usually require more funds than would

  3. Correct97% picked this

    Paying off debts, by saving a company the money it would otherwise owe in interest, decreases the company’s overall expenses

    Why this is right

    Answer C is correct.

    Skill tested: Paradox · how this choice captures the argument's function is the move to repeat next time.

  4. Trap0% picked this

    Banks are reluctant to lend money to any company that is already heavily in debt

  5. Trap0% picked this

    If the sales of a company do not grow, there is usually little need to devote a large share of

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