Weaken

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heshamelaziry: Legendary Member; Posts: 869; Joined: Wed Aug 26, 2009 3:49 pmFollowed by: 3 members; Location: California; Thanked: 13 times

by heshamelaziry » Wed Nov 04, 2009 4:37 pm

Panda corp is a large is a large American manufacturer of children clothing that has recently undertaken sharp measures to remain competitive in today's global market. In response to offshore pricing pressure, Panda corp laid off over 500 employees, reducing operational expenses by 18%. Since clothing manufacturers realize a one percentage point of increase in sales margins for every percentage point decraease in operational costs, the board of directors is satisfied that these measures will ensure panda corp long term sustainability.

Which, if true, most weakens the board stance ?

A) a panda corp main competitor is also an American manufacturer.

B) PAnda corp main competitor is based in China.

C) The largest manufacturer of children clothes in China has just reduced its operational costs by 15%

D) US consumers do not want to buy clothes manufactured offshore.

E) A large US manufacturer of children clothes palns to relocate its business to China.

[spoiler]OA C. Why D is wrong and not better than C. Hope no one tells me because it is not addressing children clothes in particular ! or that it is counter to what we know in reality that US consumers buy clothes manufactured offshore ![/spoiler]

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Source: Beat The GMAT — Critical Reasoning | Wed Nov 04, 2009 4:37 pm

pandeyvineet24: Legendary Member; Posts: 527; Joined: Mon Jun 02, 2008 9:14 am; Location: Atlanta; Thanked: 17 times

by pandeyvineet24 » Wed Nov 04, 2009 5:02 pm

heshamelaziry, i agree with you on this one. Even i picked D. Not sure why C is correct here.
Experts please share your thoughts.

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Testluv: GMAT Instructor; Posts: 1302; Joined: Mon Oct 19, 2009 2:13 pmFollowed by: 164 members; Location: Toronto; Thanked: 539 times; GMAT Score:800

Re: Weaken

by Testluv » Wed Nov 04, 2009 8:51 pm

heshamelaziry wrote:Panda corp is a large is a large American manufacturer of children clothing that has recently undertaken sharp measures to remain competitive in today's global market. In response to offshore pricing pressure, Panda corp laid off over 500 employees, reducing operational expenses by 18%. Since clothing manufacturers realize a one percentage point of increase in sales margins for every percentage point decraease in operational costs, the board of directors is satisfied that these measures will ensure panda corp long term sustainability.

Which, if true, most weakens the board stance ?

A) a panda corp main competitor is also an American manufacturer.

B) PAnda corp main competitor is based in China.

C) The largest manufacturer of children clothes in China has just reduced its operational costs by 15%

D) US consumers do not want to buy clothes manufactured offshore.

E) A large US manufacturer of children clothes palns to relocate its business to China.

[spoiler]OA C. Why D is wrong and not better than C. Hope no one tells me because it is not addressing children clothes in particular ! or that it is counter to what we know in reality that US consumers buy clothes manufactured offshore ![/spoiler]

Hi heshamelaziry,

The correct answer is definitely C. Choice D is definitely incorrect. As usual on the GMAT, there is one and only one correct answer (it is not an issue of which answer is "better" than another). This is because if there wasn't a categorical distinction between the correct answer and the four incorrect ones, then the test would lose its' meaning, and would no longer be an objective way of testing test-takers' ability.

When working on arguments, it is important to understand the conclusion and evidence precisely.

Ask yourself what the evidence establishes (the evidence is always "given" to the author).

Then ask yourself what the author is trying to prove (ie, conclusion).

The author must prove every idea in the conclusion, so once you've summed the argument up, you should then ask yourself: "how are the conclusion and evidence different?" or "what ideas are in the conclusion that are not in the evidence, and what ideas are in the evidence that are not in the conclusion?" The assumption will bridge the gap between these differentially present ideas. This is the classic Kaplan method for arguments.

Let's look at the "board's stance" (ie, argument) more closely:

The argument can basically be summed up as: because they are getting more profits (from the laying-off of employees), long-term sustainability is ensured.

So, how are the conclusion and evidence different? Well, the evidence is about profits but the conclusion is about long-term sustainability. Are these the same? Nope. You could be very profitable but if every other company in your industry is even more profitable, then your long-term sustainability is threatened.

This is why C weakens the argument, and must be correct. Fine, Panda company will realize more profits because they just laid off a bunch of employees (500). But C tells us that the largest player in the game has just responded by matching this move. (It is true that it is 15% rather than 18% but it would be 15% of a bigger number since it is the largest company). Accordingly, Choice C casts doubt on the board's contention that their move (of laying off employees) will ensure the long-term sustainability of the company.

Why is D incorrect? If US consumers do not want to buy clothes manufactured offshore, then this applies to all the companies in Panda's industry, and there is no reason to think that Panda will be hurt more than any other company in its industry (they will all be hurt).

Kaplan Teacher in Toronto

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geemat: Senior | Next Rank: 100 Posts; Posts: 43; Joined: Fri Aug 28, 2009 9:15 am

by geemat » Wed Nov 04, 2009 10:56 pm

@Testluv

Great explanation

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gmatmachoman: Legendary Member; Posts: 2326; Joined: Mon Jul 28, 2008 3:54 amFollowed by: 2 members; Thanked: 173 times; GMAT Score:710

by gmatmachoman » Thu Nov 05, 2009 3:27 am

@Testluv great Explanation.

Moreover, I t has been clearly mentioned that "rule" applies to all clothes manufacturers.

So a move profitable for US will also be benefical for chinese....

C is logical.

R&D on GMAT algorithm:

https://www.beatthegmat.com/r-d-on-gmat- ... tml#305739

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