The Federal Reserve announced its decision to raise interest rates by half a percentage point to combat rising inflation. _____...
GMAT Expression of Ideas : (Expression) Questions
The Federal Reserve announced its decision to raise interest rates by half a percentage point to combat rising inflation. _____ mortgage applications dropped by 15% within two weeks, as potential homebuyers found borrowing costs prohibitively expensive.
Which choice completes the text with the most logical transition?
Meanwhile,
Consequently,
On the other hand,
For example,
Step 1: Decode and Map the Passage
Part A: Passage Analysis Table
| Text from Passage | Analysis |
|---|---|
| "The Federal Reserve announced its decision to raise interest rates by half a percentage point to combat rising inflation." |
|
| [MISSING TRANSITION] |
|
| "mortgage applications dropped by 15% within two weeks, as potential homebuyers found borrowing costs prohibitively expensive." |
|
Part B: Passage Architecture & Core Elements
Main Point: The Federal Reserve's interest rate increase led to a significant drop in mortgage applications because borrowing became too expensive for potential homebuyers.
Argument Flow: The passage presents a clear cause-and-effect sequence where a federal policy decision creates immediate market consequences.
Step 2: Interpret the Question Precisely
This is a fill-in-the-blank question asking us to choose the best logical connector. The answer must create the right relationship between what comes before and after the blank.
Step 3: Prethink the Answer
- Looking at our passage analysis, we have the Fed raising interest rates, then mortgage applications dropping because borrowing became too expensive
- The relationship here is direct cause-and-effect
- The right connector should show that the second event is a direct result of the first event
Meanwhile,
✗ Incorrect
- "Meanwhile" indicates events happening at the same time but doesn't capture the cause-and-effect relationship we identified
Consequently,
✓ Correct
- "Consequently" directly signals that what follows is a result of what came before
- This perfectly matches our analysis showing the mortgage drop resulted from the rate increase
On the other hand,
✗ Incorrect
- "On the other hand" signals contrast or opposition between ideas
- The mortgage drop isn't contrasting with the rate increase - it's caused by it
For example,
✗ Incorrect
- "For example" introduces a specific illustration of a broader point
- The mortgage applications aren't an example of the rate increase - they're a consequence of it