Companies are often torn between the benefits of focusing on one major

A it is

Benefits of A : one speciality service: speedy deliveries ( one major service)
drawbacks of A: A rise in local taxes encourages many local businesses to move out of state ---> Income Down ---> Company is forced to lay off ppl

The situation: Specialization can put a company at advantage, but also at disadvantage. Disadvantage: one source of income makes the company susceptible to changes on the market.

A:

The messanger must lay off considerable part of workforce because he has lost clients due to a third factor. He cannot cushion the negative effect of the change on the market due to some reason: he is susceptible to the change, because he has no other major source of income: he is specialized in some field. Thus, he suffers the drawback of being specialized.

B:

The reason and consequence of the loss are relevant, not the loss itself: too little information to conclude whether the agency is susceptible or not.

C:

The reason for such intention could be current risky susceptibility to changes on the market, but also will to increase profit and many more. There exist many alternative explanations for C.

D:

Leave alone the significance to the problem, one would have to look for any relationship first.

E:

Incorrect like C, because there exist multiple reasons other than susceptibility to the market change for such behaviour, and incorrect like D, because it is unrelated to the changes on the market in question.

Corporate are torn between
A) benefits of focussing on one product b) drawbacks on relying on one primary source of income

---> means they are torn between whether to rely on one product
or on relying only on one source of income by focussing on that product alone and not on other services (maybe?)
(ask!!!)

While
A) narrow focus can help the company in shelling out a perfect and innovative (maybe?) product in comparison to other rivals
there is also a factor
B) depending on one source of income doesn't allow diversified cash flow (causing the company maybe trouble in future?)

inference (positive? possible?) = don't focus on only one?; have diversified view?;

inference (to drive home the point to NOT focus?) = example of companies who suffered because of this??

Ask yourself which is being asked? positive inference (of changes a company can make to deal with this?) or a negative inference (where companies are shown to suffer because of being torn between...?)

HOW CAN WE SEE THE TENSION REALIZED? MEANING ---> example of where a company suffers because of this? Author might have used an example to justify his

A) is the only one that gives a straightforward example of negative inference. ( = tension REALIZED)

Hi All,

The MOST important factor in the question ( as per my understanding) is that we need to complete the sentence which begins with " we can see this TENSION is realised when " --> What we are expected to do is give an example of a situation where a company has some concerns because of its style of operating ( Niche)

Now lets look at the answer choices :


(A) a local messenger service known for its speedy deliveries is forced to lay off twenty percent of its work force after a rise in local taxes encourages many local businesses to move out of state --> Now this is a "Local" service known for " speedy deliveries. Without going too much into detail, we need to notice that certainly there was a TENSION

(B) an advertising agency loses one of its clients --> All you business minded people will now argue losing a client is a tense situation as well. Sure it is but do we have any information about the advertising agency or the client ? Let me give you more examples:

1. A big advertising agency , a very small revenue customer --> Is the agency niche in its operations ? They may be into all sorts of advertisements print, radio, mobile. Losing one of the lets say 10k + customers, and that too a very small customer. Do you think it fits into the analogy required for the argument.

2. If the sentence read --> An advertising agency lost one of its biggest clients. This client contributed to 70 % of the agencies' revenue. Then this could have been a very strong contender

(C) a holding company that owns a car rental agency and a national doughnut chain is now interested in purchasing a professional basketball team ---> Will this lead to any sorts of tension ?

(D) a construction company opts to use non-union labor to increase its profits --> plans to increase profits surely do not qualify as concerning issues

(E) a specialty sandwich store decides to open franchises throughout the country that will focus on using local ingredients --> Same as C. No apparent tension.

This questions becomes extremely simple if we catch of hold of that very important word. you do not even need to get into the exercise of classifying the industry as a niche one or not. That almost becomes irrelevant.

I hope you find this approach useful.

Regards,
Shradha

I thought messenger service meant messenger "app" service like chatting apps
That's the reason I chose wrong answer.

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