Seeking a competitive advantage, some professional service firms (for example, firms providing advertising, accounting, or health care services) have considered offering unconditional guarantees of satisfaction. Such guarantees specify what clients can expect and what the firm will do if it fails to fulfill these expectations. Particularly with first-time clients, an unconditional guarantee can be an effective marketing tool if the client is very cautious, the firm’s fees are high, the negative consequences of bad service are grave, or business is diffi cult to obtain through referrals and word-of-mouth.
However, an unconditional guarantee can sometimes hinder marketing efforts. With its implication that failure is possible, the guarantee may, paradoxically, cause clients to doubt the service firm’s ability to deliver the promised level of service. It may conflict with a firm’s desire to appear sophisticated, or may even suggest that a firm is begging for business. In legal and health care services, it may mislead clients by suggesting that lawsuits or medical procedures will have guaranteed utcomes. Indeed, professional service firms with outstanding reputations and performance to match have little to gain from offering unconditional guarantees. And any firm that implements an unconditional guarantee without undertaking a commensurate commitment to quality of service is merely employing a potentially costly marketing gimmick.
Questions 39–44 refer to the passage above.
39. The primary function of the passage as a whole is to
(A) account for the popularity of a practice
(B) evaluate the utility of a practice
(C) demonstrate how to institute a practice
(D) weigh the ethics of using a strategy
(E) explain the reasons for pursuing a strategy
OA & OE
39. A The passage does not discuss the popularity of guarantees.
B Correct. Th e passage examines and judges the advantages and disadvantages of a business practice.
C The passage does not show how to put guarantees into place.
D The passage does not discuss ethics.
E The first paragraph does explain the reasons for off ering guarantees, but that is only a portion of the passage, not the passage as a whole.
The correct answer is B.
40. All of the following are mentioned in the passage as circumstances in which professional service fi rms can benefi t from offering an unconditional guarantee
(A) The firm is having difficulty retaining its clients of long standing.
(B) The firm is having difficulty getting business through client recommendations.
(C) The firm charges substantial fees for its services.
(D) The adverse effects of poor performance by the firm are signifi cant for the client.
(E) The client is reluctant to incur risk.
40 A Correct. The sentence begins by noting that unconditional guarantees are particularly important with new clients; clients of long standing are not discussed.
B Lines 12–13 include the diffi culty of getting business through referrals and word-of mouth.
C Line 10 cites high fees as such a circumstance.
D Lines 10–11 include the severe repercussions of bad service.
E Lines 9–10 cite the cautiousness of the client.
The correct answer is A.
41. Which of the following is cited in the passage as a goal of some professional service fi rms in offering unconditional guarantees of satisfaction?
(A) A limit on the fi rm’s liability
(B) Successful competition against other fi rms
(C) Ability to justify fee increases
(D) Attainment of an outstanding reputation in a fi eld
(E) Improvement in the quality of the fi rm’s service
OA & OE
41. A Th e passage does not mention liability limits.
B Correct. Some fi rms off er unconditional guarantees as a way to compete successfully against firms that do not off er them.
C Line 10 mentions that high fees would be a reason to off er guarantees, but fee increases re not discussed.
D The second paragraph suggests the reverse: off ering a guarantee may hurt a firm’s reputation.
E Improving the quality of service is not mentioned as a reason
The correct answer is B
42. The passage’s description of the issue raised by unconditional guarantees for health care or legal services most clearly implies that which of the following is true?
(A) The legal and medical professions have standards of practice that would be violated by attempts to fulfi ll such unconditional guarantees.
(B) The result of a lawsuit or medical procedure cannot necessarily be determined in advance by the professionals handling a client’s case.
(C) The dignity of the legal and medical professions is undermined by any attempts at marketing of professional services, including unconditional guarantees.
(D) Clients whose lawsuits or medical procedures have unsatisfactory outcomes cannot be adequately compensated by financial settlements alone.
(E) Predicting the monetary cost of legal or health care services is more difficult than predicting the monetary cost of other types of professional services.
42. A Although this statement may be true, it cannot be derived from the cited reference.
B Correct. Legal and medical professionals cannot guarantee the outcomes of their work.
C This statement cannot be drawn from the description of the issue.
D Compensation is not discussed in the reference.
E Predicting costs is not discussed in the reference.
The correct answer is B.
43. Which of the following hypothetical situations best exemplifi es the potential problem noted in the second sentence of the second paragraph (lines 15–19)?
(A) A physician’s unconditional guarantee of satisfaction encourages patients to sue for malpractice if they are unhappy with the treatment they receive.
(B) A lawyer’s unconditional guarantee of satisfaction makes clients suspect that the lawyer needs to fi nd new clients quickly to increase the firm’s income.
(C) A business consultant’s unconditional guarantee of satisfaction is undermined when the consultant fails to provide all of the services that are promised.
(D) An architect’s unconditional guarantee of satisfaction makes clients wonder how often the architect’s buildings fail to please clients.
(E) An accountant’s unconditional guarantee of satisfaction leads clients to believe that tax returns prepared by the accountant are certain to be accurate
OA & OE
43.A In this case, the problem occurs after, not before, the service is rendered.
B Th is situation exemplifi es another problem of unconditional guarantees, the suggestion that a firm is begging for business (line 21).
C The problem occurs after, not before, the service is rendered.
D Correct. Th e architect’s apparent need to offer an unconditional guarantee makes potential clients question the outcome of the architect’s work by suggesting the likelihood of their dissatisfaction with the architectural services.
E This situation contradicts the problem.
The correct answer is D.
44. The passage most clearly implies which of the following about the professional service firms mentioned in lines 24–27?
(A) They are unlikely to have offered unconditional guarantees of satisfaction in the past.
(B) They are usually profi table enough to be able to compensate clients according to the terms of an unconditional guarantee.
(C) They usually practice in fi elds in which the outcomes are predictable.
(D) Their fees are usually more affordable than those charged by other professional service fi rms.
(E) Their clients are usually already satisfi ed with the quality of service that is delivered.
44. A The statement in the passage concerns the present; nothing is implied about what may have been true in the past.
B The statement includes no information about profitability, so no inference may be drawn.
C No information is provided about specific fields or likely outcomes.
D Fees are not discussed in this statement.
E Correct. No guarantee is needed when clients are already satisfi ed with the quality of work provided.
The correct answer is E