OG #19 (verbal review purple book)

While depressed property values can hurt some large investors, they are potentially devastating for homeowners, whose equity – in many cases representing a life’s savings – can plunge or even disappear.

By the OG, The sentence above, choice (A), is correct. OG says, “they” refers to property values. Why is there not an ambiguity here with large investors?

Take this for example –
While depressed property values can hurt some large investors, they can always mitigate their losses by timing the market.

Sorry, I am totally confused and stumped with pronoun reference when two potential antecedents are both plural – there is no good explanation anywhere.

It's extremely unusual for good writing to contain OBJECTS of verbs that then turn around and become the referents for SUBJECT pronouns later in the sentence. Such sentences would normally prove difficult to read, because, after reading the first part of the sentence, we're 'wired' to keep the subject in subject mode, and the object in object mode.

For example:
Even though the freshmen won their exihibition match against the varsity team, it has not lost any games since then.

In this sentence, the only possible referent for 'it' is 'the varsity team'. But, without even knowing you or your reading traits, I'd be willing to bet that you had to read that sentence at least 2-3 times to figure this out.

By contrast, the sentence is MUCH more natural as:
Even though the varsity team lost its exihibition match against the freshmen, it has not lost any games since then.

Neither sentence has 'issues' with pronoun ambiguity, but the second is just better. WAY better.

Finally, let me conclude with my usual comment: GMAC is 'the native speaker', and what it says goes. If GMAC says that potential ambiguity is OK because one pronoun is clearly a subject and the other isn't (not to mention that the other noun, large investors, is utterly absurd in context), then you just have to grit your teeth, accept that as a rule, and move on.

Have fun!