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Is x>y?

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Is x>y?

(1) x+y>0
(2) x^2-y^2>0

[Reveal] Spoiler:
For 1) x+y>0
x> -y Insufficient

For 2) x^2-y^2>0
x^2>y^2
--> x<-y OR x>y

1) and 2)
x> -y
and x<-y OR x>y

So the answer should be E.
However, the answer key says C. What concept am I missing?

Thanks.

Source of the question is a file that I downloaded from the "Downloads" section here. Advanced GMAT question with readyforGMAT.com on the bottom of the page.

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