GMAT RC inference questions are one of the toughest question types. You can’t skim the content and infer. When you see the question framed as: "It can be inferred from the passage that" or “which statement do you agree to,” they are variations of the inference question type.
1) Locate or create paragraph summaries
Inference questions are most likely to quote a statement, phrase, or a word used by the author. Locate the paragraph. Once you know the paragraph, it becomes easier to dissect the author’s thoughts depending upon the structure of the passage.
If the question is to infer from the passage, capturing the paragraph summaries would help you combine the gist of each paragraph.
2) Main Idea
This is a shortcut that many test takers miss. Once you note down the paragraph that the question is referring, create the summary of each paragraph, including the paragraph that is not referred. After understanding the main idea behind each paragraph and the passage in total, it becomes easier for you to infer the author’s point.
3) Underlying Meaning
The phrases and words used by the author cannot be taken on a literal sense. Look for context, primarily through paragraph summary, and understand the underlying meaning behind the statement. Can we go beyond the literal and find an alternative explanation?
4) Avoid Personal Assumption
While we logically group statements under an idea, it should never contradict the main idea of the passage, which we have reached in Step 2. This often happens when we include our personal biases and assumptions about a scenario in order to interpret the author’s statement. A summary of each paragraph prevents us from making such an error.
5) Don’t choose the main idea instead of inference
Inference requires making some assumptions without skipping multiple steps or coloring the author’s interpretation with your personal beliefs or biases. This makes it easier for test creators to manipulate your thoughts and nudge you to choose the main idea instead of the inference.
6) Inference about the passage or about a subject
The inference question would be phrased in two forms – the subject captured in the passage or the passage as a whole.
Inference (Passage)
“What can we infer from the passage” or “We can infer from the passage that”
For inference about the passage, you should refer the paragraph summaries to find the most appropriate answer.
Inference (Subject)
“What can we infer about ‘wealth disparity’” or ‘We can infer from the passage that the advancement in AI would lead to..”
When the inference is about the subject, refer the paragraph summaries to locate the paragraph(s) where the subject is mentioned the most.
7) Process of Elimination
If you try to second-guess the author’s intention, you might lose precious time. The trick is to apply the process of elimination where you evaluate each answer choice and find whether the statement contradicts the main idea of the passage or paragraph.
Three answer choices would be out of context or irrelevant for the passage, and you can quickly eliminate them. Most of the time, solving inference question comes down to evaluating two inference statements.
8) Find the contradicting statement
Although we successfully eliminated three answer choices, picking the winner involves understanding the context, and subtly understanding what the author meant. Even after going through the summary of each paragraph, if you are stuck, analyze both the statements separately and find contradicting statements in the passage.
For example:
Answer Choice A: Lack of storage in the food distribution system is to be blamed for the rise in famine in Africa.
Answer Choice B: The corruption in the food distribution system is to be blamed for the rise in famine in Africa.
Let us assume that both the statements are shortlisted because the author has covered corruption, and inefficient storage in the passage but the trick here is looking for statements that provide direct causation for the “rise in famine in Africa.”
If the lack of storage is inferred as leading to wastage and not rise in famine, you can eliminate Answer Choice A.
Let us look at an example.
<Start of Passage - GMAT Reading Comprehension Inference Question>
Business as a concept has evolved from commonsense evaluation of profit, cost and risks, to gambling of time - waiting for the market to reach optimum size; waiting for the number of users to enter a threshold value; waiting for the public to throw money at them. Despite an Initial Public Offering (IPO) boom in 2019, led by Uber and, Pinterest, the public fundraising market is faced with a dilemma that early pioneering businesses of the 1900s didn’t have to worry - what is the difference between a great product and a great company.
The Silicon Valley attitude of ‘let us build, and they will come,’ is complemented by the false assumption of Venture capitalists (VC). Uber is still losing money. So is Pinterest. The game of balancing the burn rate of investor’s money vs the loss in each quarter often doesn’t catch up to the potential of a business. The one-off product becomes the one-stop gambling for the venture capitalists who, still go by the notion of one strike is enough to compensate the 99 losses. So, the seasoned ex-entrepreneurs, crowning the responsibility of managing billion-dollar funds begin to throw money in a round-robin manner at the next technological buzzword. AI and self-driving vehicles were the flavors of 2018. Anti-ageing and DNA manipulation would be the buzzword of 2020.
Many VCs miss the obvious good businesses. They are not solving the problems of the future generation. Stick Fix – just another online clothing store, reported a $1 billion in revenue by optimizing the power of data and customizing the shopping experience with a flat price and unique designs. A profitable company with a reasonable market share, seeking IPO, is a rarity but who cares to analyze the $15/share small business when price-wars has helped the ‘hot’ App with billion-dollar VC funding to gamble with the public money. Company culture, innovation and superior customer service is an afterthought to the maniacal search for the best price to kill the competitor and dominate the market.
<End of Passage - GMAT Reading Comprehension Inference Question>
Q) We can infer from the passage that
a) Businesses in AI and self-driving vehicles are not profitable
b) Stick Fix’s revenue of $1 billion is lower than that of Uber
c) Venture Capitalists’ ideology of betting on buzz-worthy businesses is flawed
d) Dominating the market with low-price doesn’t mean the business is good
e) By 2020, companies creating products for Anti-ageing and DNA manipulation would seek IPO.
Answer
Since the question requires us to infer from the passage instead of a subject, it is a better strategy to create paragraph summaries.
Summarizing the passage, we get
Paragraph 1: Initial Public Offering (IPO) boom in 2019. Uber and Pinterest. Public dilemma - great products vs great company.
Paragraph 2: Silicon Valley attitude + Venture Capitalists (VC) assumptions - flawed. VC gamble on one product. Strategy: One good exit compensates 99 loses. Waste money on technological buzzwords. 2018: AI and self-driving. 2020: Anti-ageing and DNA manipulation.
Paragraph 3: Venture Capitalists miss good business. Stick Fix - profitable company seeking IPO. $15/share trade. Hot App receives more investor fund. Price-war helps the Hot Apps dominate the market.
What is the main subject of the passage?
Although companies seeking IPO captures all the three paragraphs, the author criticism is geared towards venture capitalists.
Subject 1: Companies seeking IPO
Subject 2: Venture Capitalists
Main Idea: Venture capitalists should invest in businesses with profits, even though they might be coming from a typical industry.
GMAT RC Inference Bonus Tip
Once you know the main idea of the passage, don’t select an answer choice that conveys the same thought, even if it rephrased. Find an answer choice that is the subset of the main idea, not the same idea.
Let us use the process of elimination to reach the right answer choice.
Q) We can infer from the passage that
a) Businesses in AI and self-driving vehicles are not profitable
So the seasoned ex-entrepreneurs, crowning the responsibility of managing billion-dollar funds begin to throw money in a round-robin manner at the next technological buzzword. AI and self-driving vehicles were the flavors of 2018. Anti-ageing and DNA manipulation would be the buzzword of 2020.
Many VCs miss the obvious good businesses. They are not solving the problems of the future generation.
It is not clear whether the author discredits AI and self-driving cars because they are not profitable (miss the obvious good businesses), or because it is targeted for the future generation.
Eliminate
b) Stick Fix’s revenue of $1 billion is lower than that of Uber
This is another tricky inference option.
Stick Fix – just another online clothing store, reported a $1 billion in revenue by optimizing the power of data and customizing the shopping experience with a flat price and unique designs. A profitable company, seeking IPO, is a rarity but who cares to analyze the $15/share small business when price-wars has helped the ‘hot’ App with billion-dollar VC funding to gamble with the public money.
Stick Fix revenue: $1 billion
Hot App – referring to Uber: billion-dollar funding
Small Business: $15/share
Nowhere has the author cited the revenue or the share price (proposed or real) of Uber.
Avoid the temptation of using your personal knowledge to influence the answer choice.
Always refer to the passage for inference.
Eliminate
c) Venture Capitalists’ ideology of betting on buzz-worthy businesses is flawed
The author critiques the Venture Capitalists’ ideology of betting on buzz-worthy Businesses. However, the concluding sentence offers context of the position of such companies in the market.
Company culture, innovation and superior customer service is an afterthought to the maniacal search for the best price to kill the competitor and dominate the market.
We can infer that some buzz-worthy businesses are dominating the market.
Eliminate
d) Dominating the market with low-price doesn’t mean the business is good
A profitable company with a reasonable market share, seeking IPO, is a rarity but who cares to analyze the $15/share small business when price-wars has helped the ‘hot’ App with billion-dollar VC funding to gamble with the public money.
Company culture, innovation and superior customer service is an afterthought to the maniacal search for the best price to kill the competitor and dominate the market.
Based on the two sentences, we can infer that the author’s definition of a good business is a business with a balanced company culture, innovation and superior customer service with profits, not necessarily dominance of the market.
GMAT RC Inference Bonus Tip
Always infer conservatively
Keep it.
e) By 2020, companies creating products for Anti-ageing and DNA manipulation would seek IPO.
This is a big leap of faith without any data or statement to support it.
Eliminate
Correct Answer: D
Now let us look at a question with the same passage, but the inference is about a subject in the passage.
<Start of Passage - GMAT Reading Comprehension Inference>
Business as a concept has evolved from commonsense evaluation of profit, cost and risks, to gambling of time - waiting for the market to reach optimum size; waiting for the number of users to enter a threshold value; waiting for the public to throw money at them. Despite an Initial Public Offering (IPO) boom in 2019, led by Uber and, Pinterest, the public fundraising market is faced with a dilemma that early pioneering businesses of the 1900s didn’t have to worry - what is the difference between a great product and a great company.
The Silicon Valley attitude of ‘let us build, and they will come,’ is complemented by the false assumption of Venture capitalists (VC). Uber is still losing money. So is Pinterest. The game of balancing the burn rate of investor’s money vs the loss in each quarter often doesn’t catch up to the potential of a business. The one-off product becomes the one-stop gambling for the venture capitalists who, still go by the notion of one strike is enough to compensate the 99 losses. So the seasoned ex-entrepreneurs, crowning the responsibility of managing billion-dollar funds begin to throw money in a round-robin manner at the next technological buzzword. AI and self-driving vehicles were the flavors of 2018. Anti-ageing and DNA manipulation would be the buzzword of 2020.
Many VCs miss the obvious good businesses. They are not solving the problems of the future generation. Stick Fix – just another online clothing store, reported a $1 billion in revenue by optimizing the power of data and customizing the shopping experience with a flat price and unique designs. A profitable company with a reasonable market share, seeking IPO, is a rarity but who cares to analyze the $15/share small business when price-wars has helped the ‘hot’ App with billion-dollar VC funding to gamble with the public money. Company culture, innovation and superior customer service is an afterthought to the maniacal search for the best price to kill the competitor and dominate the market.
<End of Passage - GMAT Reading Comprehension Inference>
Q) We can infer from the passage that Venture Capitalists prefer
a) Businesses that could fetch more than $15/share in an IPO
b) Businesses operating in technology and disease management
c) Businesses with social goals
d) Betting on risky businesses
e) Businesses over innovative products
Since the inference question points out to a subject, you don’t have to worry about creating paragraph summaries. However, we recommend that you do as the summary could help you locate the subject at a faster rate.
GMAT RC Inference Bonus Tip
To answer inference question where the subject is referred, quoting the line contradicting the statement is the fastest way to reach the right answer.
Q) We can infer from the passage that Venture Capitalists prefer
a) Businesses that could fetch more than $15/share in an IPO
A profitable company with a reasonable market share, seeking IPO, is a rarity but who cares to analyze the $15/share small business when price-wars has helped the ‘hot’ App with billion-dollar VC funding to gamble with the public money.
Although the author critiques the VC for not funding the $15/share ‘small business’, the passage doesn’t offer enough information on the target price for the IPO.
Eliminate
b) Businesses operating in technology and disease management
managing billion-dollar funds begin to throw money in a round-robin manner at the next technological buzzword. AI and self-driving vehicles were the flavors of 2018. Anti-ageing and DNA manipulation would be the buzzword of 2020.
Self-driving vehicles represent the transportation industry. Anti-ageing doesn’t fall under disease management.
If you have any doubts in categorizing the examples into the broader statement mentioned in the answer choice, it is safe to eliminate them.
Eliminate
c) Businesses with social goals
Nowhere in the passage has the author mentioned social goals. Out of Scope.
Eliminate.
d) Betting on risky businesses
VC’s tendency to bet on risky businesses has been reiterated several times.
The one-off product becomes the one-stop gambling for the venture capitalists who, still go by the notion of one strike is enough to compensate the 99 losses.
The Silicon Valley attitude of ‘let us build, and they will come,’ is complemented by the false assumption of Venture capitalists (VC). Uber is still losing money. So is Pinterest.
Keep it
e) Businesses over innovative products
The opposite is true.
Many VCs miss the obvious good businesses.
The one-off product becomes the one-stop gambling for the venture capitalists
Eliminate.
Correct Answer: D
