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Suncorp, a new corporation with limited funds, has been

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Manager
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Suncorp, a new corporation with limited funds, has been [#permalink] New post 07 Aug 2012, 14:08
00:00
A
B
C
D
E

Difficulty:

  5% (low)

Question Stats:

89% (02:06) correct 10% (00:54) wrong based on 415 sessions
Suncorp, a new corporation with limited funds, has
been clearing large sections of the tropical Amazon
forest for cattle ranching. This practice continues
even though greater profits can be made from rubber
tapping, which does not destroy the forest, than from
cattle ranching, which does destroy the forest.

Which of the following, if true, most helps to explain
why Suncorp has been pursuing the less profitable of
the two economic activities mentioned above?

(A) The soil of the Amazon forest is very rich in
nutrients that are important in the development
of grazing lands.

(B) Cattle-ranching operations that are located in
tropical climates are more profitable than
cattle-ranching operations that are located in
cold-weather climates.

(C) In certain districts, profits made from cattle
ranching are more heavily taxed than profits
made from any other industry.

(D) Some of the cattle that are raised on land
cleared in the Amazon are killed by wildcats.

(E) The amount of money required to begin a
rubber-tapping operation is twice as high as the
amount needed to begin a cattle ranch.
[Reveal] Spoiler: OA
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Re: Suncorp, a new corporation with limited funds, has [#permalink] New post 08 Aug 2012, 15:53
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Its E. The clue is Suncorp's 'limited funds' which is a 'new' corporation. Since the start-up costs are higher in rubber-tapping, it went for cattle ranch even though greater profits can be made from rubber tapping.
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WE 1: 7 Yrs in Automobile (Commercial Vehicle industry)
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Re: Suncorp, a new corporation with limited funds, has [#permalink] New post 08 Aug 2012, 15:58
Its E.
B: Out of scope
AD: opposite
Between B & C, My pick is E
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Re: Suncorp, a new corporation with limited funds, has [#permalink] New post 10 Aug 2012, 18:40
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(A) The soil of the Amazon forest is very rich in
nutrients that are important in the development
of grazing lands.
so it is equally good for rubber plants also-not directly related to the two businesses related above-incorrect

(B) Cattle-ranching operations that are located in
tropical climates are more profitable than
cattle-ranching operations that are located in
cold-weather climates.
climatic conditions are not under consideration-incorrect

(C) In certain districts, profits made from cattle
ranching are more heavily taxed than profits
made from any other industry.
then it is actually opposite to the answer we are looking for !

(D) Some of the cattle that are raised on land
cleared in the Amazon are killed by wildcats.
cattle farming/ranching will avoid such problems - irrelevant

(E) The amount of money required to begin a
rubber-tapping operation is twice as high as the
amount needed to begin a cattle ranch.
correct- it will ensure that the business will start with less capital as the company is new and has limited funds.

(E) wins
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Re: Suncorp, a new corporation with limited funds, has [#permalink] New post 10 Aug 2012, 23:50
E is the only choice that talks about the funds, which is important for the company to do this activity.
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Re: Suncorp, a new corporation with limited funds, has [#permalink] New post 12 Aug 2012, 21:42
betterscore wrote:
Suncorp, a new corporation with limited funds, has
been clearing large sections of the tropical Amazon
forest for cattle ranching. This practice continues
even though greater profits can be made from rubber
tapping, which does not destroy the forest, than from
cattle ranching, which does destroy the forest.

Which of the following, if true, most helps to explain
why Suncorp has been pursuing the less profitable of
the two economic activities mentioned above?

(A) The soil of the Amazon forest is very rich in
nutrients that are important in the development
of grazing lands.

(B) Cattle-ranching operations that are located in
tropical climates are more profitable than
cattle-ranching operations that are located in
cold-weather climates.

(C) In certain districts, profits made from cattle
ranching are more heavily taxed than profits
made from any other industry.

(D) Some of the cattle that are raised on land
cleared in the Amazon are killed by wildcats.

(E) The amount of money required to begin a
rubber-tapping operation is twice as high as the
amount needed to begin a cattle ranch.


E is the clear winner

A If the soil is good in nutrients , it will support both activities - Neutral
B Cattle ranching operation at different location should not matter - Out of Scope
C it actually contradicts or weakens, why cattle ranching should not be done - weakens
D Out of scope
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Director
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Re: Suncorp, a new corporation with limited funds, has been [#permalink] New post 20 Feb 2014, 18:38
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).

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Re: Suncorp, a new corporation with limited funds, has been   [#permalink] 20 Feb 2014, 18:38
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