2 Missed the "why" behind the explanation of the grandfather's death
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Grammatically it is fine to say "My grandfather was dead", but there are two odd things about

My grandfather was dead in China.

It is odd to say that your grandfather was dead in China. His body is in China, but he is just dead. For example, if I say "My hair was brown in Texas." it makes you wonder if it changes color when I leave Texas and visit China. Also the past tense makes it odd, because you think "You hair was brown, but what color is it todayit's still brown right now, so why did you use the past tense?"

I might have said

My grandfather passed away suddenly in China, and I must travel there to make the funeral arrangements.

If I was explaining something that happened in the past, I might have said

The reason why I wasn't at work for a month in that year was because my grandfather had diedhad died and I needed to travel to China to make the funeral arrangements.

I think that the interviewer may have been uncomfortable talking with you about the loss of your grandfather and the odd addition of "in China" made him laugh out of nervousness. He tried to cover up his nervousness/discomfort with a bad joke. It was insensitive, but I don't think it was intended to be mean.

Grammatically it is fine to say "My grandfather was dead", but there are two odd things about

My grandfather was dead in China.

It is odd to say that your grandfather was dead in China. His body is in China, but he is just dead. For example, if I say "My hair was brown in Texas." it makes you wonder if it changes color when I leave Texas and visit China. Also the past tense makes it odd, because you think "You hair was brown, but what color is it today?"

I might have said

My grandfather passed away suddenly in China, and I must travel there to make the funeral arrangements.

If I was explaining something that happened in the past, I might have said

The reason why I wasn't at work for a month in that year was because my grandfather had died and I needed to travel to China to make the funeral arrangements.

I think that the interviewer may have been uncomfortable talking with you about the loss of your grandfather and the odd addition of "in China" made him laugh out of nervousness. He tried to cover up his nervousness/discomfort with a bad joke. It was insensitive, but I don't think it was intended to be mean.

Grammatically it is fine to say "My grandfather was dead", but there are two odd things about

My grandfather was dead in China.

It is odd to say that your grandfather was dead in China. His body is in China, but he is just dead. For example, if I say "My hair was brown in Texas." it makes you wonder if it changes color when I leave Texas and visit China. Also the past tense makes it odd, because you think "You hair was brown, but it's still brown right now, so why did you use the past tense?"

If I was explaining something that happened in the past, I might have said

The reason why I wasn't at work for a month in that year was because my grandfather had died and I needed to travel to China to make the funeral arrangements.

I think that the interviewer may have been uncomfortable talking with you about the loss of your grandfather and the odd addition of "in China" made him laugh out of nervousness. He tried to cover up his nervousness/discomfort with a bad joke. It was insensitive, but I don't think it was intended to be mean.

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source | link

Grammatically it is fine to say "My grandfather was dead", but there are two odd things about

My grandfather was dead in China.

It is odd to say that your grandfather was dead in China. His body is in China, but he is just dead. For example, if I say "My hair was brown in Texas." it makes you wonder if it changes color when I leave Texas and visit China. Also the past tense makes it odd, because you think "You hair was brown, but what color is it today?"

I might have said

My grandfather passed away suddenly in China, and I must travel there to make the funeral arrangements.

If I was explaining something that happened in the past, I might have said

The reason why I wasn't at work for a month in that year was because my grandfather had died and I needed to travel to China to make the funeral arrangements.

I think that the interviewer may have been uncomfortable talking with you about the loss of your grandfather and the odd addition of "in China" made him laugh out of nervousness. He tried to cover up his nervousness/discomfort with a bad joke. It was insensitive, but I don't think it was intended to be mean.