Company X experienced a significant loss of market share over a number of years. To strengthen its market position, the

Company X experienced a significant loss of market share over a number of years. To strengthen its market position, the company decided two years ago to increase the percentage of total revenue devoted to research and development. The following year, the company's market share increased by 10 percent. In response, company management further increased the amount of money devoted to research and development.

Which of the following investigations is most likely to yield significant information that would help evaluate whether the company's decision to further increase the research and development budget was warranted?

(A) Determining how many new products the company has created over the past year

(B) Determining the percentage of revenue that other companies devote to research and development

(C) Determining whether any of the company's competitors have withdrawn from the market in the past two years

(D) Determining the maximum percentage of revenue that the company can devote to research and development without affecting the company's production budget

(E) Determining whether all of the company's new products have fared equally well in the marketplace


OA C

Source: Manhattan Prep