essay - GMAT: Argument 31

The following appeared in a newspaper story giving advice about investments:

As overall life expectancy continues to rise, the population of our country is growing increasingly older. For example, more than 20 percent of the residents of one of our more populated regions are now at least 65 years old, and occupancy rates at resort hotels in that region declined significantly during the past six months. Because of these two related trends, a prudent investor would be well advised to sell interest in hotels and invest in hospitals and nursing homes instead.

Discuss how well reasoned . . . etc.

Answer:
The author concludes that investing in hospitals and nursing homes is recommendable and those who have invested in hotels should retreat their investment as soon as possible. The reasons that he is counting on are twofold. First, the elderly people are increasing because of prolonged life expectancy. Second, regional resort hotels are devastating its sales figure in this six months drastically. His argument, however, is weak for the following reasons.

First, there's no direct causal relationship shown between the increase of elderly people and the decrease of the sales of the hotel industry. It's unreasonable to connect them, because increased elderly people doesn't necessarily mean the drop of the sales. Rather, it might happen that the increase of elderly people will contribute to the hotel industry, because, say, they have a lot of money and time. Furthermore, whether the whole population is declining or not is not mentioned. This can also be the drawback.

Second, although the author cites the data saying the sales of local resort hotels for this six months significantly plummeted, the argument is not well established. First, six month decline doesn't necessarily mean the whole year sales figure. Generally speaking, the hotel industry has seasonality. Seasonality means, the revenue widely varies with the season. Summer resorts can attract tourists in summer, but in winter the hotels would have difficulty to do so. Besides, the article doesn't mention the source of the comparison, and thereby the argument is not reasonable.

Finally, the author recommends investing in hospitals and nursing homes instead, but there's no reason to support it shown. Therefore, the readers have no way to judge whether the investment is better than the one of hotels or not. This imperfect statement seriously damages the justification of the reasoning.

In conclusion, the argument is weak for the reasons I mentioned above. To strengthen the argument, the author must do the following things at least: showing a clear link between the trend of the population and the revenue of the hotel industry, citing a survey result for the whole year not a half, and stating the premise that his recommendation stands on.