Weaken Question.

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USA automative companies are having a difficult time competing with car manufacturers in South Korea. USA manufacturers have decided that they must significantly lower the wages of their employees in order to compete with Korean manufacturers, because wages constitute approximately 30% of the cost of producing an automobile.

Which of the following, if true, provides the most compelling argument against lowering wages?

A] Lowering wages will cause the best workers to leave, lowering quality of the final product, which could lower sales.

B] Raw materials, such as steel, constitute 55% of the cost of an automobile.

C] US automakers have recently made inroads on foreign manufacturers and recaptured market share.

D] U.S. worker's wages are 25% higher than those of workers in South Korea.

E] U.S auto manufacturers recently increased their spending on advertising.



The OA is A.

Getting this was not that hard...

[vk_vinayak]

Agree with the OA.

[Bill@VeritasPrep]

A provides a reason that the suggested plan will not have the desired effect of allowing US companies to compete more effectively. Correct.

B is irrelevant; even if wages are not the largest part of the cost of an automobile, they are still sizable enough to have an effect.

C is irrelevant; the argument is concerned with South Korea specifically, not foreign competitors generally.

D reinforces that wages are a differentiating factor between the US and South Korea, but knowing the exact number does not directly affect the conclusion.

E is also irrelevant to the suggested course of action.