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Studies in restaurants show that the tips left by customers

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Studies in restaurants show that the tips left by customers [#permalink] New post 29 Sep 2007, 11:47
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Studies in restaurants show that the tips left by customers who pay their bill in cash tend to be larger when the bill is presented on a tray that bears a credit-card logo. Consumer psychologists hypothesize that simply seeing a credit-card logo makes many credit-card holders willing to spend more because it reminds them that their spending power exceeds
the cash they have immediately available.

Which of the following, if true, most strongly supports the psychologists’ interpretation of the studies?

A. The effect noted in the studies is not limited to patrons who have credit cards.
B. Patrons who are under financial pressure from their credit-card obligations tend to tip less when presented with a restaurant bill on a tray with credit-card logo than when the tray has no logo.
C. In virtually all of the cases in the studies, the patrons who paid bills in cash did not possess credit cards.
D. In general, restaurant patrons who pay their bills in cash leave larger tips than do those who pay by credit card.
E. The percentage of restaurant bills paid with given brand of credit card increases when that credit card’s logo is displayed on the tray with which the bill is prepared.

I picked A........views???
[Reveal] Spoiler: OA
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Re: CR - SET 23 Q31 [#permalink] New post 29 Sep 2007, 13:11
singh_amit19 wrote:
Studies in restaurants show that the tips left by customers who pay their bill in cash tend to be larger when the bill is presented on a tray that bears a credit-card logo. Consumer psychologists hypothesize that simply seeing a credit-card logo makes many credit-card holders willing to spend more because it reminds them that their spending power exceeds
the cash they have immediately available.

Which of the following, if true, most strongly supports the psychologists’ interpretation of the studies?

A. The effect noted in the studies is not limited to patrons who have credit cards.
B. Patrons who are under financial pressure from their credit-card obligations tend to tip less when presented with a restaurant bill on a tray with credit-card logo than when the tray has no logo.
C. In virtually all of the cases in the studies, the patrons who paid bills in cash did not possess credit cards.
D. In general, restaurant patrons who pay their bills in cash leave larger tips than do those who pay by credit card.
E. The percentage of restaurant bills paid with given brand of credit card increases when that credit card’s logo is displayed on the tray with which the bill is prepared.

I picked A........views???


Interpretation: Credit card logo reminds people (with credit card) of spending power
A, C, D all weakens this statement. E says that the logo reminds people with that "particular" card, but not spending power.

B is the best since it clearly states the relationship between spending power and credit card logo.
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 [#permalink] New post 29 Sep 2007, 17:57
Agree with B. It's the only choice that shows the relationship between the thinking behind a credit card logo and what the customers pay.
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Re: CR - SET 23 Q31 [#permalink] New post 29 Sep 2007, 19:44
singh_amit19 wrote:
Studies in restaurants show that the tips left by customers who pay their bill in cash tend to be larger when the bill is presented on a tray that bears a credit-card logo. Consumer psychologists hypothesize that simply seeing a credit-card logo makes many credit-card holders willing to spend more because it reminds them that their spending power exceeds
the cash they have immediately available.

Which of the following, if true, most strongly supports the psychologists’ interpretation of the studies?

A. The effect noted in the studies is not limited to patrons who have credit cards.
B. Patrons who are under financial pressure from their credit-card obligations tend to tip less when presented with a restaurant bill on a tray with credit-card logo than when the tray has no logo.
C. In virtually all of the cases in the studies, the patrons who paid bills in cash did not possess credit cards.
D. In general, restaurant patrons who pay their bills in cash leave larger tips than do those who pay by credit card.
E. The percentage of restaurant bills paid with given brand of credit card increases when that credit card’s logo is displayed on the tray with which the bill is prepared.

I picked A........views???


Conc - credit card logo remindes customers that they have more purchasing power available.
My pick B. people with debt don't pay more tip because credit card reminds that they don't have much purchasing power.
IMO A weakens the argument.
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Re: CR - SET 23 Q31 [#permalink] New post 29 Sep 2007, 20:05
bkk145 wrote:
singh_amit19 wrote:
Studies in restaurants show that the tips left by customers who pay their bill in cash tend to be larger when the bill is presented on a tray that bears a credit-card logo. Consumer psychologists hypothesize that simply seeing a credit-card logo makes many credit-card holders willing to spend more because it reminds them that their spending power exceeds
the cash they have immediately available.

Which of the following, if true, most strongly supports the psychologists’ interpretation of the studies?

A. The effect noted in the studies is not limited to patrons who have credit cards.
B. Patrons who are under financial pressure from their credit-card obligations tend to tip less when presented with a restaurant bill on a tray with credit-card logo than when the tray has no logo.
C. In virtually all of the cases in the studies, the patrons who paid bills in cash did not possess credit cards.
D. In general, restaurant patrons who pay their bills in cash leave larger tips than do those who pay by credit card.
E. The percentage of restaurant bills paid with given brand of credit card increases when that credit card’s logo is displayed on the tray with which the bill is prepared.

I picked A........views???


Interpretation: Credit card logo reminds people (with credit card) of spending power
A, C, D all weakens this statement. E says that the logo reminds people with that "particular" card, but not spending power.

B is the best since it clearly states the relationship between spending power and credit card logo.


BINGO....OA is B
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Re: CR - SET 23 Q31 [#permalink] New post 29 Sep 2007, 22:26
singh_amit19 wrote:
Studies in restaurants show that the tips left by customers who pay their bill in cash tend to be larger when the bill is presented on a tray that bears a credit-card logo. Consumer psychologists hypothesize that simply seeing a credit-card logo makes many credit-card holders willing to spend more because it reminds them that their spending power exceeds
the cash they have immediately available.

Which of the following, if true, most strongly supports the psychologists’ interpretation of the studies?

A. The effect noted in the studies is not limited to patrons who have credit cards.
B. Patrons who are under financial pressure from their credit-card obligations tend to tip less when presented with a restaurant bill on a tray with credit-card logo than when the tray has no logo.
C. In virtually all of the cases in the studies, the patrons who paid bills in cash did not possess credit cards.
D. In general, restaurant patrons who pay their bills in cash leave larger tips than do those who pay by credit card.
E. The percentage of restaurant bills paid with given brand of credit card increases when that credit card’s logo is displayed on the tray with which the bill is prepared.

I picked A........views???


I didn't get this one, ran outta time =(.

B makes sense now.

A: irrelevant we are concerned w/ people w/ credit cards. if anything this weakens the argument by suggesting that credit cards are not the only cause to this.
C: weakens the argument.
D: seems to weaken the argument.
E:Irrelevant.

B: if we have the opposite effect as explained in B then the argument is valid.
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Re: CR - SET 23 Q31 [#permalink] New post 19 Jun 2011, 04:30
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singh_amit19 wrote:
Studies in restaurants show that the tips left by customers who pay their bill in cash tend to be larger when the bill is presented on a tray that bears a credit-card logo. Consumer psychologists hypothesize that simply seeing a credit-card logo makes many credit-card holders willing to spend more because it reminds them that their spending power exceeds
the cash they have immediately available.

Which of the following, if true, most strongly supports the psychologists’ interpretation of the studies?

A. The effect noted in the studies is not limited to patrons who have credit cards.
B. Patrons who are under financial pressure from their credit-card obligations tend to tip less when presented with a restaurant bill on a tray with credit-card logo than when the tray has no logo.
C. In virtually all of the cases in the studies, the patrons who paid bills in cash did not possess credit cards.
D. In general, restaurant patrons who pay their bills in cash leave larger tips than do those who pay by credit card.
E. The percentage of restaurant bills paid with given brand of credit card increases when that credit card’s logo is displayed on the tray with which the bill is prepared.

I picked A........views???


I gout stumped while choosing B as i thought its kind of weird statement
but later on after reading i found that this is exact opposite of what we want
and exact opposite is appropriate.........
as people when reminded of debt paid lesser tip (which shows the effect of logo on the tray)

hope i got it right now :? :?

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Re: Studies in restaurants show that the tips left by customers [#permalink] New post 09 Dec 2011, 02:25
Conclusion: simply seeing a credit-card logo makes many credit-card holders willing to spend more

Option B says that people who are in debt are reminded of the debt when they see the credit card logo on the bill. That is why they tip less. However, it also implies that the negation is true.
If these people had not been in debt, then these people would have tipped more. This strengthens the argument. Thus option B indirectly strengthens the hypothesis.

Is this understanding correct? Please explain because I got this answer wrong. :(
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Re: Studies in restaurants show that the tips left by customers [#permalink] New post 12 Mar 2013, 11:19
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singh_amit19 wrote:
Studies in restaurants show that the tips left by customers who pay their bill in cash tend to be larger when the bill is presented on a tray that bears a credit-card logo. Consumer psychologists hypothesize that simply seeing a credit-card logo makes many credit-card holders willing to spend more because it reminds them that their spending power exceeds
the cash they have immediately available.

Which of the following, if true, most strongly supports the psychologists’ interpretation of the studies?

A. The effect noted in the studies is not limited to patrons who have credit cards.
B. Patrons who are under financial pressure from their credit-card obligations tend to tip less when presented with a restaurant bill on a tray with credit-card logo than when the tray has no logo.
C. In virtually all of the cases in the studies, the patrons who paid bills in cash did not possess credit cards.
D. In general, restaurant patrons who pay their bills in cash leave larger tips than do those who pay by credit card.
E. The percentage of restaurant bills paid with given brand of credit card increases when that credit card’s logo is displayed on the tray with which the bill is prepared.

I picked A........views???


Got a PM to respond to this.

I can see some great explanations above. Let me add my two cents to the discussion.

Argument Analysis

My very first observation of the given passage is that it is a causal argument. A causal argument is one in which we attribute the cause of some past event, say X, to some past event or a rule or something else, say Y. In other words, we say that X has caused Y or that X led to Y

In the given argument, we have

Y: the tips left by customers who pay their bill in cash tend to be larger when the bill is presented on a tray that bears a credit-card logo
X: simply seeing a credit-card logo makes many credit-card holders willing to spend more because it reminds them that their spending power exceeds the cash they have immediately available

As we can see, even X has a causal structure and can be written as:
Credit card reminds credit card holders that their spending power exceeds the cash they have immediately available ---->> (leads to) seeing a credit-card logo makes many credit-card holders willing to spend more ---->>> the tips left by customers who pay their bill in cash is larger when the bill is presented on a tray that bears a credit-card logo

In essence, the hypothesis is that that credit card reminds people of their high spending power - this leads them to spend more - this leads in higher tips.

Prethinking

This is a strengthen question, as is clear from the question stem. We need to strengthen the psychologist's hypothesis. Since this is causal argument where we say that X is the reason for Y, we can strengthen it by saying that
1. There is no Z which can be the reason for Y OR
2. If we increase X while keeping everything else same, we'll increase Y - This could be indicated by saying that when customer see the credit card logo of the company they hold credit card of, they tip more than that when they see credit card logos of other companies.
3. IF we remove X while keeping everything else same, we'll not have Y - i.e. if the credit card logo doesn't remind people of their higher purchasing power, they would not tip higher.

With this pre-thinking, let's move over to the option statements:

Analysis of option statements

A. The effect noted in the studies is not limited to patrons who have credit cards. - Ok. But do people who don't have credit cards tip higher or lower than people with credit cards? The option statement doesn't provide this. Without this information, this statement doesn't have an impact on the hypothesis. If it had stated that people without credit cards tip lower than others when presented with trays with credit card logo, then it would have strengthened the hypothesis.

B. Patrons who are under financial pressure from their credit-card obligations tend to tip less when presented with a restaurant bill on a tray with credit-card logo than when the tray has no logo. - This is interesting. This says that guys under credit card obligations tend to tip less when presented with trays with credit card logo. This kind of guy has lesser spending power than his available cash, exactly opposite to the case considered in the argument and this guy tips less, which is also exactly opposite the case in the argument. This kind of behavior is expected if the hypothesis holds. Since the hypothesis says that credit card logo reminds one of his spending power - a guy with good credit limit and low credit card obligations is expected to spend more and a guy with high credit card obligations is expected to spend less. Therefore, the given statement provides an evidence that the hypothesis holds in a different scenario. Therefore, this is the CORRECT option.

C. In virtually all of the cases in the studies, the patrons who paid bills in cash did not possess credit cards. - This actually weakens the hypothesis. If a guy doesn't have a credit card, how would a credit card logo remind him of his higher spending power?

D. In general, restaurant patrons who pay their bills in cash leave larger tips than do those who pay by credit card. - This is irrelevant comparison. We are not concerned with the payment method here.

E. The percentage of restaurant bills paid with given brand of credit card increases when that credit card’s logo is displayed on the tray with which the bill is prepared. - Again, we are not concerened how the payment is made.

Therefore, the correct choice is Option B.

Hope this helps :)

Thanks,
Chiranjeev

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Re: Studies in restaurants show that the tips left by customers [#permalink] New post 13 Mar 2013, 11:36
ok got it this is like cause effect... if x happens y happens and if x doesnt happen y doesnt happen.

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Re: Studies in restaurants show that the tips left by customers [#permalink] New post 13 Mar 2013, 20:35
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singh_amit19 wrote:
Studies in restaurants show that the tips left by customers who pay their bill in cash tend to be larger when the bill is presented on a tray that bears a credit-card logo. Consumer psychologists hypothesize that simply seeing a credit-card logo makes many credit-card holders willing to spend more because it reminds them that their spending power exceeds
the cash they have immediately available.

Which of the following, if true, most strongly supports the psychologists’ interpretation of the studies?

A. The effect noted in the studies is not limited to patrons who have credit cards.
B. Patrons who are under financial pressure from their credit-card obligations tend to tip less when presented with a restaurant bill on a tray with credit-card logo than when the tray has no logo.
C. In virtually all of the cases in the studies, the patrons who paid bills in cash did not possess credit cards.
D. In general, restaurant patrons who pay their bills in cash leave larger tips than do those who pay by credit card.
E. The percentage of restaurant bills paid with given brand of credit card increases when that credit card’s logo is displayed on the tray with which the bill is prepared.

I picked A........views???


There has been a detailed discussion on this question before. Here are my thoughts:

Let's look at the argument:

Argument: Studies show that cash tips left by customers are larger when the bill is presented on a tray that bears a credit-card logo.

Why would that be? Why would there be a difference when the tray has no logo and when the tray has a credit card logo?

Psychologists' hypothesize that seeing a credit-card logo reminds people of the spending power given by the card they have (and that their spending power exceeds the cash they have right now).

We have to support the psychologists' interpretation.

Say, I change the argument a little and add a line:

Argument: Studies show that cash tips left by customers are larger when the bill is presented on a tray that bears a credit-card logo. Patrons under financial pressure from credit-card obligations tend to tip less when presented with a restaurant bill on a tray with credit-card logo than when the tray has no logo.

Now, does the psychologists' interpretation make even more sense. Understand that the psychologists' interpretation is only that 'seeing a logo reminds people of their own credit card status'. The part 'that their spending power exceeds the cash they have right now' explains the higher tips. If we are given that some tip more on seeing that card logo and some tip less on seeing it, it makes sense, right? Different people have different credit card obligation status. Hence, people are reminded of their own card obligation status and they tip accordingly. Hence, option (B) makes the probability of psychologists' interpretation being true stronger because it tells you that in case of very high card obligations, customers tip less. This is what you would expect if the psychologists' interpretation were correct.

It's something like this:
Me: After 12 hrs of night time sleep, I can't study.
Your theory: Yeah, because your sleep pattern is linked to your level of concentration. After a long sleep, your mind is still muddled and lazy so you cant study.
Me: After 4 hrs of night time sleep, I can't study either.

Does your theory make more sense? Sure! You said 'sleep pattern is linked to your level of concentration'. If I sleep too much, my concentration gets affected. If I sleep too little, again my concentration gets affected. So your theory that 'sleep pattern is linked to your level of concentration' certainly makes more sense.


Option (E) (the one that confuses people) is incorrect.
(E) - 'The percentage of restaurant bills paid with given brand of credit card increases when that credit card's logo is displayed on the tray with which the bill is prepared.'

This options supports the hypothesis that card logo reminds people of their own card (not of their card obligations). The psychologists' interpretation talks about the logo reminding people of their card status (high spending power or high obligations).

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Re: Studies in restaurants show that the tips left by customers [#permalink] New post 26 Mar 2013, 03:08
egmat wrote:
singh_amit19 wrote:
Studies in restaurants show that the tips left by customers who pay their bill in cash tend to be larger when the bill is presented on a tray that bears a credit-card logo. Consumer psychologists hypothesize that simply seeing a credit-card logo makes many credit-card holders willing to spend more because it reminds them that their spending power exceeds
the cash they have immediately available.

Which of the following, if true, most strongly supports the psychologists’ interpretation of the studies?

A. The effect noted in the studies is not limited to patrons who have credit cards.
B. Patrons who are under financial pressure from their credit-card obligations tend to tip less when presented with a restaurant bill on a tray with credit-card logo than when the tray has no logo.
C. In virtually all of the cases in the studies, the patrons who paid bills in cash did not possess credit cards.
D. In general, restaurant patrons who pay their bills in cash leave larger tips than do those who pay by credit card.
E. The percentage of restaurant bills paid with given brand of credit card increases when that credit card’s logo is displayed on the tray with which the bill is prepared.

I picked A........views???


Got a PM to respond to this.

I can see some great explanations above. Let me add my two cents to the discussion.

Argument Analysis

My very first observation of the given passage is that it is a causal argument. A causal argument is one in which we attribute the cause of some past event, say X, to some past event or a rule or something else, say Y. In other words, we say that X has caused Y or that X led to Y

In the given argument, we have

Y: the tips left by customers who pay their bill in cash tend to be larger when the bill is presented on a tray that bears a credit-card logo
X: simply seeing a credit-card logo makes many credit-card holders willing to spend more because it reminds them that their spending power exceeds the cash they have immediately available

As we can see, even X has a causal structure and can be written as:
Credit card reminds credit card holders that their spending power exceeds the cash they have immediately available ---->> (leads to) seeing a credit-card logo makes many credit-card holders willing to spend more ---->>> the tips left by customers who pay their bill in cash is larger when the bill is presented on a tray that bears a credit-card logo

In essence, the hypothesis is that that credit card reminds people of their high spending power - this leads them to spend more - this leads in higher tips.

Prethinking

This is a strengthen question, as is clear from the question stem. We need to strengthen the psychologist's hypothesis. Since this is causal argument where we say that X is the reason for Y, we can strengthen it by saying that
1. There is no Z which can be the reason for Y OR
2. If we increase X while keeping everything else same, we'll increase Y - This could be indicated by saying that when customer see the credit card logo of the company they hold credit card of, they tip more than that when they see credit card logos of other companies.
3. IF we remove X while keeping everything else same, we'll not have Y - i.e. if the credit card logo doesn't remind people of their higher purchasing power, they would not tip higher.

With this pre-thinking, let's move over to the option statements:

Analysis of option statements

A. The effect noted in the studies is not limited to patrons who have credit cards. - Ok. But do people who don't have credit cards tip higher or lower than people with credit cards? The option statement doesn't provide this. Without this information, this statement doesn't have an impact on the hypothesis. If it had stated that people without credit cards tip lower than others when presented with trays with credit card logo, then it would have strengthened the hypothesis.

B. Patrons who are under financial pressure from their credit-card obligations tend to tip less when presented with a restaurant bill on a tray with credit-card logo than when the tray has no logo. - This is interesting. This says that guys under credit card obligations tend to tip less when presented with trays with credit card logo. This kind of guy has lesser spending power than his available cash, exactly opposite to the case considered in the argument and this guy tips less, which is also exactly opposite the case in the argument. This kind of behavior is expected if the hypothesis holds. Since the hypothesis says that credit card logo reminds one of his spending power - a guy with good credit limit and low credit card obligations is expected to spend more and a guy with high credit card obligations is expected to spend less. Therefore, the given statement provides an evidence that the hypothesis holds in a different scenario. Therefore, this is the CORRECT option.

C. In virtually all of the cases in the studies, the patrons who paid bills in cash did not possess credit cards. - This actually weakens the hypothesis. If a guy doesn't have a credit card, how would a credit card logo remind him of his higher spending power?

D. In general, restaurant patrons who pay their bills in cash leave larger tips than do those who pay by credit card. - This is irrelevant comparison. We are not concerned with the payment method here.

E. The percentage of restaurant bills paid with given brand of credit card increases when that credit card’s logo is displayed on the tray with which the bill is prepared. - Again, we are not concerened how the payment is made.

Therefore, the correct choice is Option B.

Hope this helps :)

Thanks,
Chiranjeev
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OG13 Q95 [#permalink] New post 13 Oct 2013, 07:35
Studies in restaurants show thatthe tips left by customers who pay their bill in cash tend to be larger when the
bill is presented on a tray that bears a credit-card logo. Consumer psychologists hypothesize that simply seeing
a credit-card logo makes many credit-card holders willing to spend more because it reminds them that their
spending power exceeds the cash they have immediately available.

Which of the following, if true, most strongly supports the psychologists' interpretation of the studies?
(A) The effect noted in the studies is not limited to patrons who have credit cards.
(B) Patrons who are under financial pressure from their credit-card obligations tend to tip less when presented
with a restaurant bill on a tray with a credit-card logo than when the tray has no logo.
(0 In virtually all of the cases in the studies, the patrons who paid bills in cash did not possess credit cards.
(D) In general, restaurant patrons whopay their bills in cash leave larger tips than do those who pay by
credit card.
(E) The percentage of restaurant bills paid with a given brand of credit card increases when that credit card's
logo is displayed on the tray with which the bill is presented.

Can anyone explain the solution with the reasoning ?
Thanks in advance

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Re: OG13 Q95 [#permalink] New post 13 Oct 2013, 08:17
This question has already been discussed very nicely by e-gmat and Karishma in the following thread:

studies-in-restaurants-show-that-the-tips-left-by-customers-53061.html

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Re: OG13 Q95 [#permalink] New post 13 Oct 2013, 18:14
TirthankarP wrote:
This question has already been discussed very nicely by e-gmat and Karishma in the following thread:

studies-in-restaurants-show-that-the-tips-left-by-customers-53061.html



Thanks dude...Will check it up there.. :) :)

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Re: Studies in restaurants show that the tips left by customers [#permalink] New post 05 Apr 2014, 08:59
i dont like the explanation for B, we're suppose to assume the person would leave a bigger tip if he wasn't under financial pressure. It sounds like it weakens the argument
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Re: Studies in restaurants show that the tips left by customers [#permalink] New post 05 Apr 2014, 09:11
I dont understand B, if someone sees the credit card logo then decides to tip less, how does that strengthen the argument.
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Re: Studies in restaurants show that the tips left by customers [#permalink] New post 07 Apr 2014, 04:47
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kedusei wrote:
I dont understand B, if someone sees the credit card logo then decides to tip less, how does that strengthen the argument.


I have explained it here: studies-in-restaurants-show-that-the-tips-left-by-customers-53061.html#p1195719

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Re: Studies in restaurants show that the tips left by customers   [#permalink] 07 Apr 2014, 04:47
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