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Discussion :: Critical Resoning

  1. While expressing concern over the rapid pullout of foreign institutional investor (FII) money, the finance minister said that it is mainly due to the economic crisis in Europe and the pullout is adversely effecting the Indian stock market. FIIs said that they are in need of funds to stabilise their operations in the European markets.
    A. There is no lock-in period for the FII money for pullout.
    B. The pilled out FII money will be used by the institutions for their European operations.
    C. Some FII money that was pulled out was invested in the Indian stock market.
    D. The domestic institutional investors may also pull out of the Indian stock market.
    E. The FIIs do not have sufficient money to handle European crisis and also to remain invested in the Indian stock market.
    Which of the statements A, B, C, D and E mentioned above represents an inferences that can be drawn from the above statement?
    2. A.
    A and E
    B.
    B alone
    C.
    C and E
    D.
    D alone
    E.
    E alone

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    Answer : Option E

    Explanation :

    The statement does not indicate whether the FIIs pulled out after expiry of the lock-in period of there is no lock in period at all. Hence (A) is out of context. 

    It is stated that the man reason for pullout of funds is the European crisis. From this it can be concluded that this money is going to be used in Europe. Hence (B) is a conclusion. 

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