Zeddifreddo’s Acquisition

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Given that, recently, the founders of startup company Zeddifreddo have confirmed that they are in the late stages of discussion of an acquisition offer from another company, other potential acquirers of the company, who had suspected that Zeddifreddo's business performance was mostly hype and not a product of sound financials, have taken interest in making their own acquisition offers. They figure that, if Zeddifreddo's current potential acquirer has reached late stages of an acquisition discussion without having withdrawn its bid, that the acquirer must have had a chance to audit Zeddifreddo's financial position and has found it to be sound. Such reasoning might be hasty, however, since potential acquirers of a startup have been known to overlook that company's financial soundness and favor the acquisition on other grounds, however ill-advised such a position may be.

In the argument given, the two boldfaced portions play which of the following roles?

The ﬁrst describes evidence that has been taken as supporting a conclusion; the second gives a reason for questioning that support.

The ﬁrst describes evidence that has been taken as supporting a conclusion; the second states a contrary conclusion that is the main conclusion of the argument.

The ﬁrst provides evidence in support of the main conclusion of the argument; the second states that conclusion.

The ﬁrst describes the circumstance that the argument as a whole seeks to explain; the second gives the explanation that the argument seeks to establish.

The ﬁrst describes the circumstance that the argument as a whole seeks to explain; the second provides evidence in support of the explanation that the argument seeks to establish.

Review: Zeddifreddo's Acquisition

Explanation

Reading the question: we're in boldfaced territory, so we confirm from the question that our task here is to identify the logical roles played by the various sentences in the prompt.

Sentence

Starts With.../Includes...

Function

1st

"Given that the founders...have confirmed"

Supports view of other potential acquirers

1st

"who had suspected that..."

View of other potential acquirers

2nd

"they figure that..."

Supports view of other potential acquirers

3rd

"Such reasoning might be hasty, however,"

Contrary view

3rd

"since potential acquirers...have been known"

Supports contrary view

Creating a filter: opinion-charged words help parse the prompt into two views. Boldfaced portion #1 supports opinion #1, and boldfaced #2 supports opinion #2, which is a contrary opinion.

Applying the filter: (B) and (C) call sentence #2 a conclusion, so they are out. Choice (D) is out; the argument as a whole is not seeking to explain the fact that Zeddifreddo is in the late states of the acquisition, but rather what the late stage says about its financials. (E) is out for the same reason. We go back to confirm (A). The first sentence has indeed been taken as support that the company has sound financials, and the second sentence gives a reason to question it. The correct answer is (A).

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Zeddifreddo’s Acquisition