I'm happy to help.ANALYZE THE ARGUMENT:
Fact: Country X imposes heavy tariffs on imported manufactured goods.
Conclusion: Company Y has determined that it could increase its profits in the long term
by opening a factory in Country X to manufacture the goods that it currently produces in its home country for sale in Country X.KEY
words: “profits the long term
”. If Y wants to make profits in the long term, it MUST be able to sell its products. If Y can't sell its products, the strategy will fail.
For Company Y's determination to be true, which of the following assumptions must also be true?ANALYZE EACH ANSWER:
Company Y will be able to obtain all the necessary permits to open a factory in Country X. Wrong.
Obtain all permits does NOT guarantee that Y can sell products and have long term profits. Selling products does not depend on acquiring permits ONLY.
Company Y currently produces no goods outside its home country. Wrong.
It’s fact. B cannot be the assumption. Clearly, fact is not an assumption.
A sustainable market for Company Y's goods currently exists in Country X.Correct.
Key word is “sustainable market
”. C means customers in country X are willing to buy Y’s goods for long term. That is the key for Y’s dermination to be true.
Company Y's home country does not impose tariffs on imported goods. Wrong.
Out of scope. The argument does not talk about the tariff policies in country Y.
Labor costs in Country X are lower than those in Company Y's home country.Wrong.
Quite Tempting. Labor costs is just one of many costs involving the manufacturing process. What if labor costs are lower in Country X, but other costs such as rent, electricity, insurances, etc… are higher than those in Country Y. Thus cost of good sold of Y’s goods is high, making prices for Y’s good not competitive.
Hope it helps.
Please +1 KUDO if my post helps. Thank you.
"Designing cars consumes you; it has a hold on your spirit which is incredibly powerful. It's not something you can do part time, you have do it with all your heart and soul or you're going to get it wrong."
Chris Bangle - Former BMV Chief of Design.