Community activist: If Morganville wants to keep its central

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Community activist: If Morganville wants to keep its central shopping district healthy, it should prevent the opening of a huge SaveAll discount department store on the outskirts of Morganville. Records from other small towns show that whenever SaveAll has opened a store outside the central shopping district of a small town, within five years the town has experienced the bankruptcies of more than a quarter of the stores in the shopping district.

The answer to which of the following would be most useful for evaluating the community activist’s reasoning?

A. Have community activists in other towns successfully campaigned against the opening of a SaveAll store on the outskirts of their towns?
B. Do a large percentage of the residents of Morganville currently do almost all of their shopping at stores in Morganville?
C. In towns with healthy central shopping districts, what proportion of the stores in those districts suffer bankruptcy during a typical five-year period?
D. What proportion of the employees at the SaveAll store on the outskirts of Morganville will be drawn form Morganville?
E. Do newly opened SaveAll stores ever lose money during their first five years of operation?

OA after some explanations...[code][/code]

dear fluke
its an og question
answer is c

A,D and E>> are irrelevant...

b/w B and C

will go with option C, since it looks at another unexplored area of the stats given by the activist, so the answer to this question will help evaluate the activist's reasoning.

IMO C.

I pick C. The author suggests that the opening of the saveall store causes bankruptcies to occur in 25% of the stores in the shopping district. if we were to know what the percentage of stores went bankrupt, independent of the effects of saveall, it would shed insight on whether or not saveall contributes to the effect, and thus help us evaluate the author's reasoning.

B: for me.

C has a very strong case, but I think B calls out a more fundamental issue than C does.

B:
Currently, do people shop in the central shopping district? If yes, then yeah saveall will cause a major problem. But if people do not, then saveall's effects on past bankruptcies as a reason to not allow them to open shop does not hold much water.

And if people, do shop in the central shopping district then allowing saveall to open shop can definitely play a big part in future bankruptcies.

C: The key piece of info missing here is SaveAll's effect on these bankruptcies. Even if we were to know how many shops go bankrupt during a five-year period, it has no correlation to SaveAll's effects.

Between, B & C --> B sounds more reasonable to me.

The problem with B is that even if you know whether most people in Morganville shop in the central district, Saveall might still cause bankruptcies because everyone will move to Saveall. If you knew whether most people in OTHER districts used to shop in the central district, before Saveall was opened, that may help.

I think you're missing what C states.
25% of shops go bankrupt after Saveall opens. If 5% go bankrupt during a five-year period, Saveall is "correlated" with a 20% increase in bankruptcies. If 25% of shops go bankrupt, then there's no real correlation between Saveall and an increase in bankruptcies. Thus knowing the "a priori" percentage of bankruptcies would help in evaluating whether or not Saveall contributes to such an effect.

B is correct. What if people currently don't buy departmental items from Morganville (shopping might be currently healthy due to jewellery, electronics etc. we don't know about it). But, it will atleast address the basic check point.
C is so generic. It doesn't confine the search to towns that are affected by SaveAll alone. Bankruptcy could be due to several reason.

C

I selected B, but also agree to the explanation provided for C. As of now confused..
What is OA??

This question was really a 750 level Question
because it looks so simple to answer B (as most of us . at least 50% has given in their answers)
but when we dig deeper it comes out to be C........
i also fell in the trap....
dont know what would be my reply if this kind of question appears in my real GMAT

I think there are few assumptions in this passage; Considering those assumptions.

B makes more sense:

Hypothetical but a possible case:
If 100 people are in the town and they are all shopping outside the town already, then how is opening of SaveAll affect central shopping district, which is in the town?
If 90 people shop in town, then there is a possibility that Saveall causes the trouble.
Thus, two different answers to this question is helping us gauge the argument.

C: Suppose C evaluation says 100% suffered bankruptcy. How does it affect Morganville? The evaluation will be as good as the premise.
Maybe all the other towns had dilapidated stores and in their town OR the stores sold rotten goods. Thus, it was not the discount that attracted the consumers, but its quality and aesthetic.
And Morganvilles' stores can be very different from the other towns stores.

Ans: "B"

Thanks Warlock007:

I ignored the usage of article "a" and the usage of simple present tense(which conveys facts). "C" does make sense.

C. In towns with healthy central shopping districts, what proportion of the stores in those districts suffer bankruptcy during a typical five-year period?

I considered it "the" -- the 5 year period in which SaveAll was at their backyard.
C actually says: in any given 5 year period without SaveAll at the backyard, how many of them go bankrupt.

Arrrrghhhhhhhhh!!!!!

C it is.

Apply variance test

To apply the variance test , you should choose polar opposite answers:


In towns with healthy central shopping districts, what proportion of the stores in those districts suffer bankruptcy during a typical five-year period?

Ans 1 : More than a quarter (25%) : Well that means SaveAll does not cause bankruptcies. Since it is happening in towns with Healthy shopping districts, it must be normal for a quarter to go bankrupt in 5 year period.


Ans 2 : Less than a quarter(25 %) : That means SaveAll does cause some stores to go bankrupt.


Crick

Hey Fluke
I think this kind of traps make it tough cracking 700+ on gmat.....

Agree with the justification for C but still B perplexes me.

Applying variance test for B

Ans 1: Yes (say 90%) - In this case opening of SaveAll may attract the customers from stores in Morganville(90%) and hence would lead to their bankruptcies.

Ans 2: No( say 10%) - Stores are already surviving with only 10% of customers. In this case opening of SaveAll would not affect much. I guess this is the point which most of us have considered while opting for B.

Now, when I pen down, I wonder what if SaveAll would attract those 10% customers and that itself is sufficient enough for stores to go bankrupt.

C

+1 C

well the the question here is does SaveAll causes other store to close or not...... in the first 5 year.

then probably the first thing to analyze is in normal conditions how many stores close with out the SaveAll intervention.

+ 1 For C.

my pick is C