Many companies have recently required their employees to pay : GMAT Critical Reasoning (CR)
Check GMAT Club Decision Tracker for the Latest School Decision Releases http://gmatclub.com/AppTrack

 It is currently 18 Jan 2017, 10:22

# STARTING SOON:

Open Admission Chat with MBA Experts of Personal MBA Coach - Join Chat Room to Participate.

### GMAT Club Daily Prep

#### Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

# Events & Promotions

###### Events & Promotions in June
Open Detailed Calendar

# Many companies have recently required their employees to pay

 new topic post reply Question banks Downloads My Bookmarks Reviews Important topics
Author Message
TAGS:

### Hide Tags

Director
Joined: 21 Dec 2009
Posts: 591
Concentration: Entrepreneurship, Finance
Followers: 18

Kudos [?]: 661 [2] , given: 20

Many companies have recently required their employees to pay [#permalink]

### Show Tags

24 Nov 2012, 03:20
2
KUDOS
4
This post was
BOOKMARKED
00:00

Difficulty:

35% (medium)

Question Stats:

66% (02:29) correct 34% (01:37) wrong based on 562 sessions

### HideShow timer Statistics

Many companies have recently required their employees to pay an increasing percentage of the cost of health
insurance premiums. On average, the companies that instituted this change reported an 11 percent increase in
profits for the last fiscal year.

If, on the basis of the evidence above, it is argued that increasing the portion of health insurance costs
paid directly by employees increased a company's profitability, which of the following, if true, would most seriously
weaken that argument?

A: The increased cost of health insurance premiums at some companies led highly skilled employees of those
companies to move to competing firms with lower health costs.
B: Companies that have cut employee benefit costs in other areas such as retirement packages have also seen
increased profits.
C: Companies that increased the percentage of health insurance premiums paid directly by employees were just as
likely as other companies to give employees a raise during the last fiscal year.
D: Because employees often object to paying a large percentage of health insurance premiums, it can take a long time
to implement the changes.
E: On average, companies that did not increase the percentage of health insurance premiums paid by their employees
reported a 16 percent increase in profits for the last fiscal year.

why is
[Reveal] Spoiler:
A
wrong?
[Reveal] Spoiler: OA

_________________

KUDOS me if you feel my contribution has helped you.

If you have any questions
you can ask an expert
New!
Manager
Joined: 04 Oct 2011
Posts: 224
Location: India
Concentration: Entrepreneurship, International Business
GMAT 1: 440 Q33 V13
GMAT 2: 0 Q0 V0
GPA: 3
Followers: 0

Kudos [?]: 48 [0], given: 44

Re: Many companies have recently required their employees [#permalink]

### Show Tags

24 Nov 2012, 03:46
1
This post was
BOOKMARKED
gmatbull wrote:
Many companies have recently required their employees to pay an increasing percentage of the cost of health
insurance premiums. On average, the companies that instituted this change reported an 11 percent increase in
profits for the last fiscal year.

If, on the basis of the evidence above, it is argued that increasing the portion of health insurance costs
paid directly by employees increased a company's profitability, which of the following, if true, would most seriously
weaken that argument?

A: The increased cost of health insurance premiums at some companies led highly skilled employees of those
companies to move to competing firms with lower health costs.
B: Companies that have cut employee benefit costs in other areas such as retirement packages have also seen
increased profits.
C: Companies that increased the percentage of health insurance premiums paid directly by employees were just as
likely as other companies to give employees a raise during the last fiscal year.
D: Because employees often object to paying a large percentage of health insurance premiums, it can take a long time
to implement the changes.
E: On average, companies that did not increase the percentage of health insurance premiums paid by their employees
reported a 16 percent increase in profits for the last fiscal year.

why is
[Reveal] Spoiler:
A
wrong?

Oh i selected A!!!

I felt E seems to give another fact like stated in conclusion/premise..
How come this will weaken the argument????

_________________

GMAT - Practice, Patience, Persistence
Kudos if u like

Manager
Joined: 20 Sep 2008
Posts: 85
Followers: 3

Kudos [?]: 85 [0], given: 165

Re: Many companies have recently required their employees [#permalink]

### Show Tags

24 Nov 2012, 13:48
gmatbull wrote:
Many companies have recently required their employees to pay an increasing percentage of the cost of health
insurance premiums. On average, the companies that instituted this change reported an 11 percent increase in
profits for the last fiscal year.

If, on the basis of the evidence above, it is argued that increasing the portion of health insurance costs
paid directly by employees increased a company's profitability, which of the following, if true, would most seriously
weaken that argument?

A: The increased cost of health insurance premiums at some companies led highly skilled employees of those
companies to move to competing firms with lower health costs.
B: Companies that have cut employee benefit costs in other areas such as retirement packages have also seen
increased profits.
C: Companies that increased the percentage of health insurance premiums paid directly by employees were just as
likely as other companies to give employees a raise during the last fiscal year.
D: Because employees often object to paying a large percentage of health insurance premiums, it can take a long time
to implement the changes.
E: On average, companies that did not increase the percentage of health insurance premiums paid by their employees
reported a 16 percent increase in profits for the last fiscal year.

why is
[Reveal] Spoiler:
A
wrong?

Losing talent is not the same as losing money. Hence it doesn't directly weaken the conclusion.

E is an example of effect happening (profit up) without cause (raising health insurance premiums) occurring.
Intern
Joined: 16 Mar 2012
Posts: 14
Schools: Mays Business School - Class of 2016
Followers: 0

Kudos [?]: 17 [0], given: 6

Re: Many companies have recently required their employees [#permalink]

### Show Tags

25 Nov 2012, 00:37
Premise: many companies that reqd. employees to pay higher ins. premiums -> Those companies increased profits averaging 11%
Conclusion: Inc. premiums -> Profits

Task: Find an alternate reason that can lead to higher profits /or/ prove that substantial no. of companies that increased premiums didn't see inc. in profits

[A]: Some companies bla bla. The argument never said 'ALL' companies saw inc. in profits. Also, the argument is concerned only about premuims paid by employees regardless they are highly skilled or not.
[B]: Good for those companies! No bearing on the conclusion.
[C]: Giving a likely raise to employees has no bearing on profits. If you are thinking that giving out money to employees will decrease the profit/revenue, then you're thinking too far!
[D]: The event in the argument has already occured. This option states what 'can' happen. OUT
[E]: This states that ins. premiums paid are not the cause of profits, if anything, ins. premiums paid marginally decrease avg. profits (11% v/s 16% avg. profits).

IMO, E wins!
Current Student
Joined: 29 Oct 2012
Posts: 38
Location: United States
Concentration: Social Entrepreneurship, International Business
GMAT 1: 710 Q42 V45
GPA: 3.67
WE: Project Management (Non-Profit and Government)
Followers: 1

Kudos [?]: 18 [0], given: 12

Re: Many companies have recently required their employees [#permalink]

### Show Tags

26 Nov 2012, 06:02
Doh! I selected A without reading all of the options properly. Let that be a lesson to me...
Intern
Joined: 11 Jul 2013
Posts: 34
Followers: 0

Kudos [?]: 2 [0], given: 35

Re: Many companies have recently required their employees [#permalink]

### Show Tags

05 Oct 2013, 05:07
Premise: many companies that reqd. employees to pay higher ins. premiums -> Those companies increased profits averaging 11%
Conclusion: Inc. premiums -> Profits

Task: Find an alternate reason that can lead to higher profits /or/ prove that substantial no. of companies that increased premiums didn't see inc. in profits

[A]: Some companies bla bla. The argument never said 'ALL' companies saw inc. in profits. Also, the argument is concerned only about premuims paid by employees regardless they are highly skilled or not.
[B]: Good for those companies! No bearing on the conclusion.
[C]: Giving a likely raise to employees has no bearing on profits. If you are thinking that giving out money to employees will decrease the profit/revenue, then you're thinking too far!
[D]: The event in the argument has already occured. This option states what 'can' happen. OUT
[E]: This states that ins. premiums paid are not the cause of profits, if anything, ins. premiums paid marginally decrease avg. profits (11% v/s 16% avg. profits).

IMO, E wins!

can someone please explain why d is wrong it says implementing will take time so even if companies increased the premium it is yet not implemented and therefore the profits can not be attributed to premium increase "
Senior Manager
Joined: 07 Nov 2012
Posts: 346
Schools: LBS '14 (A)
GMAT 1: 770 Q48 V48
Followers: 191

Kudos [?]: 366 [1] , given: 4

Re: Many companies have recently required their employees to pay [#permalink]

### Show Tags

05 Oct 2013, 05:39
1
KUDOS
Hi,

D is wrong because it confuses time frames....

The statement is that for companies that have made the change Profits are up by 11%.

D is talking about the timeframe. This is irrelevant for the purposes of our argument, as in the example we are given the change has already happened.

Also - think about the question it is 'most seriously weakens' - that is clearly E. Even if the 'delay' was a factor, it would not be more serious than the problem posed by E.

James
_________________

Former GMAT Pill student, now on staff. Used GMATPILL OG 12 and nothing else: 770 (48,48) & 6.0

... and more

Intern
Joined: 11 Jul 2013
Posts: 34
Followers: 0

Kudos [?]: 2 [0], given: 35

Re: Many companies have recently required their employees to pay [#permalink]

### Show Tags

06 Oct 2013, 06:24
plumber250 wrote:
Hi,

D is wrong because it confuses time frames....

The statement is that for companies that have made the change Profits are up by 11%.

D is talking about the timeframe. This is irrelevant for the purposes of our argument, as in the example we are given the change has already happened.

Also - think about the question it is 'most seriously weakens' - that is clearly E. Even if the 'delay' was a factor, it would not be more serious than the problem posed by E.

James

thanks James thanks for replying .....i got it now + 1 for you
GMAT Club Legend
Joined: 01 Oct 2013
Posts: 10531
Followers: 918

Kudos [?]: 203 [0], given: 0

Re: Many companies have recently required their employees to pay [#permalink]

### Show Tags

24 Jun 2015, 20:27
Hello from the GMAT Club VerbalBot!

Thanks to another GMAT Club member, I have just discovered this valuable topic, yet it had no discussion for over a year. I am now bumping it up - doing my job. I think you may find it valuable (esp those replies with Kudos).

Want to see all other topics I dig out? Follow me (click follow button on profile). You will receive a summary of all topics I bump in your profile area as well as via email.
Director
Joined: 21 Jun 2014
Posts: 503
Concentration: General Management, Technology
GMAT 1: 540 Q45 V20
GPA: 2.49
WE: Information Technology (Computer Software)
Followers: 12

Kudos [?]: 167 [0], given: 92

Re: Many companies have recently required their employees to pay [#permalink]

### Show Tags

08 Aug 2015, 10:44

Effect : Increased Profit

C-->E , Correct option should ruin this cause and effect relationship.

option E breaks the C&E relationship - "when cause was not there (i.e. No Increase in premium), Effect (Profit still increased) was still there".

+1 E
_________________

---------------------------------------------------------------
Target - 720-740
helpful post means press '+1' for Kudos!
http://gmatclub.com/forum/information-on-new-gmat-esr-report-beta-221111.html
http://gmatclub.com/forum/list-of-one-year-full-time-mba-programs-222103.html

Manager
Joined: 15 May 2010
Posts: 188
Location: India
Concentration: Strategy, General Management
WE: Engineering (Manufacturing)
Followers: 0

Kudos [?]: 31 [0], given: 65

Re: Many companies have recently required their employees to pay [#permalink]

### Show Tags

12 Aug 2015, 11:26

The company x does some stuff that leads to another stuff. How it can be weakened by that company y doesn't do the same stuff and leads to same outcome stuff what company x got?
Intern
Joined: 04 Apr 2012
Posts: 12
Schools: Katz '18 (S)
GMAT 1: 640 Q49 V28
Followers: 0

Kudos [?]: 8 [0], given: 2

Many companies have recently required their employees to pay [#permalink]

### Show Tags

19 Aug 2015, 06:28
This is tested most frequently on GMAT with Assumptions, Strengthen and Weaken Questions.

A causes B

Premium given by employees (rather than by company itself) caused company's profit to increase to 11%(because company not paying that part)

To weaken - we can show A does not happens but B happens - then A is not the cause of B

This is perfectly done by answer choice E

Premium paid by employees did not increase - But Profits increase by more than 11% - 16% to be exact.

Another way to weaken such type of questions is:

C causes B
Or
A happens and B does not happen i.e. Premiums paid by employees increased but profits either stay flat or decreased.

Regards
Intern
Joined: 25 Oct 2014
Posts: 10
Followers: 0

Kudos [?]: 2 [0], given: 0

Re: Many companies have recently required their employees to pay [#permalink]

### Show Tags

24 Aug 2015, 12:37
So, I need to weaken the argument's conclusion. If we can show another explanation( here,another unknown reason) for the Same effect, the argument will be less likely to be true. E shows exactly what we need. Maybe, there's another reason. maybe the cut cost decreases the profit, but increases( compare 11% and 16%)
Re: Many companies have recently required their employees to pay   [#permalink] 24 Aug 2015, 12:37
Similar topics Replies Last post
Similar
Topics:
27 Pro-Tect Insurance Company has recently been paying out more 9 09 Sep 2013, 10:06
7 Many employees of GEOCOM, a company established five years 4 22 Apr 2013, 00:56
3 Many companies now have employee assistance programs that 8 21 Mar 2011, 16:55
2 Many companies now have employee assistance programs that 11 21 Sep 2008, 06:29
A law requiring companies to offer employees unpaid time off 5 08 Dec 2007, 12:31
Display posts from previous: Sort by

# Many companies have recently required their employees to pay

 new topic post reply Question banks Downloads My Bookmarks Reviews Important topics

 Powered by phpBB © phpBB Group and phpBB SEO Kindly note that the GMAT® test is a registered trademark of the Graduate Management Admission Council®, and this site has neither been reviewed nor endorsed by GMAC®.