In corporate purchasing, competitive scrutiny

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In corporate purchasing, competitive scrutiny is typically limited to suppliers of items that are directly related to end products. With "indirect" purchases(such as computers, advertising, and legal services), which are not directly related to production, corporations often favor "supplier partnerships"(arrangements in which the purchaser forgoes the right to pursue alternative suppliers), which can inappropriately shelter suppliers from rigorous competitive scrutiny that might afford the purchaser economic leverage. There are two independent variables-availability of alternatives and ease ofchanging suppliers-that companies should use to evaluate the feasibility of subjecting suppliers of indirect purchases to competitive scrutiny.



This can create four possible situations. In Type 1 situations, there are many alternatives and change is relatively easy. Open pursuit of alternatives-by frequent competitive bidding, if possible-will likely yield the best results. In Type 2 situations, where there are many alternatives but change is difficult-as for providers of employee health-care benefits-it is important to continuously test the market and use the results to secure concessions from existing suppliers. Alternatives
provide a credible threat to suppliers, even if the ability to switch is constrained. In Type 3 situations, there are few alternatives, but the ability to switch without difficulty creates a threat that companies can use to negotiate concessions from existing suppliers. In Type 4 situations, where there are few alternatives and change is difficult, partnerships may be unavoidable.


Which of the following best describes the relation of the second paragraph to the first?

A. The second paragraph offers proof of an assertion made in the first paragraph.
B. The second paragraph provides an explanation for the occurrence of a situation described in the first paragraph.
C. The second paragraph discusses the application of a strategy proposed in the first paragraph.
D. The second paragraph examines the scope of a problem presented in the first paragraph.
E. The second paragraph discusses the contradictions inherent in a relationship described in the first paragraph.


I marked D, however the OA is C
Last edited by ankit0411 on Mon Oct 01, 2012 7:46 am, edited 2 times in total.
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by anuprajan5 » Mon Oct 01, 2012 6:51 am
Hey Ankit,

I'd try to answer, but I can't differentiate between paragraphs.

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Anup

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by ankit0411 » Mon Oct 01, 2012 7:48 am
anuprajan5 wrote:Hey Ankit,

I'd try to answer, but I can't differentiate between paragraphs.

Regards
Anup
Done mate !
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by anuprajan5 » Mon Oct 01, 2012 8:10 am
Hey Ankit,

My answer to this would be C. My thought process is that

1st paragraph - describes a situation that is not apt and proposes 2 variables that can be considered for a particular strategy

2nd paragraph - describes the various situations in which the 2 variables can be used.



A. The second paragraph offers proof of an assertion made in the first paragraph. - There is no assertion in the first paragraph and no proof is presented.
B. The second paragraph provides an explanation for the occurrence of a situation described in the first paragraph. - Nope. No explanation
C. The second paragraph discusses the application of a strategy proposed in the first paragraph. - Bingo! Matches my thought in terms of application of the variables for a certain strategy.
D. The second paragraph examines the scope of a problem presented in the first paragraph.
Nope! The 2nd para relates back into the 1st by way of application of certain variables.
E. The second paragraph discusses the contradictions inherent in a relationship described in the first paragraph. Nada!

Hope this helps!

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Anup

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by ankit0411 » Mon Oct 01, 2012 10:07 pm
anuprajan5 wrote:Hey Ankit,

My answer to this would be C. My thought process is that

1st paragraph - describes a situation that is not apt and proposes 2 variables that can be considered for a particular strategy

2nd paragraph - describes the various situations in which the 2 variables can be used.



A. The second paragraph offers proof of an assertion made in the first paragraph. - There is no assertion in the first paragraph and no proof is presented.
B. The second paragraph provides an explanation for the occurrence of a situation described in the first paragraph. - Nope. No explanation
C. The second paragraph discusses the application of a strategy proposed in the first paragraph. - Bingo! Matches my thought in terms of application of the variables for a certain strategy.
D. The second paragraph examines the scope of a problem presented in the first paragraph.
Nope! The 2nd para relates back into the 1st by way of application of certain variables.
E. The second paragraph discusses the contradictions inherent in a relationship described in the first paragraph. Nada!

Hope this helps!

Regards
Anup
Good one, I now understand the difference. :)
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by rohitmanglik » Thu Nov 27, 2014 7:47 pm
As you said, 1st paragraph is about situation. Why B is wrong?
anuprajan5 wrote:Hey Ankit,

My answer to this would be C. My thought process is that

1st paragraph - describes a situation that is not apt and proposes 2 variables that can be considered for a particular strategy

2nd paragraph - describes the various situations in which the 2 variables can be used.



A. The second paragraph offers proof of an assertion made in the first paragraph. - There is no assertion in the first paragraph and no proof is presented.
B. The second paragraph provides an explanation for the occurrence of a situation described in the first paragraph. - Nope. No explanation
C. The second paragraph discusses the application of a strategy proposed in the first paragraph. - Bingo! Matches my thought in terms of application of the variables for a certain strategy.
D. The second paragraph examines the scope of a problem presented in the first paragraph.
Nope! The 2nd para relates back into the 1st by way of application of certain variables.
E. The second paragraph discusses the contradictions inherent in a relationship described in the first paragraph. Nada!

Hope this helps!

Regards
Anup