Hotel T

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Hotel T

by Cheese12 » Sat Oct 22, 2011 3:40 am
Surveys reveal that the vast majority of hotel guests in the United States resent the high prices of the items in the mini-bars in their hotel rooms.These guests would prefer to have an empty refrigerator in their rooms in order to have space to put their own food and beverages, although a large percentage of these guests would still make at least one purchase from their in-room mini-bar. After analyzing the results of the study, the management of Hotel T decided that it would be more profitable to eliminate the mini-bar and install empty refrigerators in each room.

Which of the following, if true, would support Hotel T's plan to increase profitability by eliminating in room mini-bars in favor of empty refrigerators?


A) There is currently some space available in Hotel T's in-room mini-bars for guests to put their own items.
B) Hotel T is located in the United States.
C) Some guests of Hotel T do not make any purchases from their in-room mini-bars.
D) The money that Hotel T makes from the mini-bar purchases of its guests is less than the money that Hotel T loses from discarding mini-bar items that have not sold by their expiration dates.
E) It will cost Hotel T less money to maintain empty refrigerators in its guest rooms than to maintain stocked mini-bars in those rooms.


OA: D.... why is the answer not B? can someone pls explain.. thanks!

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by rohit_gmat » Sat Oct 22, 2011 9:31 pm
IMO D

thts the only one that directly gives evidence of how eliminating the mini bar can increase profits -> becoz the loss from the discarded items exceeds the profits made from the sales

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by GmatKiss » Mon Oct 24, 2011 10:39 am
Why not B, B is horrible for me. The most unfit option :D

D and E were left out,
D wins with the purchase- sale theory (related to profits)

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by turbo jet » Thu Nov 17, 2011 5:55 am
Was tossing between D and E

D option tells us that that negative profit (loss) is made because of mini bars.(Profit=Sales Revenue - Cost) Hence doing away with mini bars will prevent loss and hence increase profitability.

E option talks only about cost. Hence it is slightly ambiguous to predict profitability.So rejected.
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by tuanquang269 » Fri Nov 18, 2011 6:15 am
B is totally wrong because it is out of scope. We need choice that mention money here (because the conclusion talk about profit). Only D and E are the contenders. At the first time, I choose E because D is quite hard to understand. After rereading 2 twice. I choose D because the loose from maintaining mini bar is larger the earning from selling items. E is also strengthen, but not power like D.