Transnational Cooperation among corporations is experiencing : GMAT Critical Reasoning (CR)
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# Transnational Cooperation among corporations is experiencing

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VP
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Transnational Cooperation among corporations is experiencing [#permalink]

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12 Jul 2006, 09:45
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Transnational Cooperation among corporations is experiencing a modest renaissance among U.S firms, even though projects undertaken by two or more corporations under a collaborative agreement are less profitable than projects undertaken by a single corporation. The advantage of transnational cooperation is that such joint international projects may allow U.S firms to win foreign contracts that they would not otherwise be able to win.

Which of the following statements by a US corporate officer best fits the situation of US firms as described in the passage?

(A) "We would rather make only a share of the profit and also risk only a share of a possible loss than run the full risk of a loss"

(B) "We would rather make a share of a relatively modest profit than end up making none of a potentially much bigger profit"

(C) "We would rather cooperate and build good will than poison the business climate by all-out competition"

(D) "We would rather have foreign corporations join us in American projects than join them in projects in their home countries"

(E) "We would rather win a contract with a truly competitive bid of our own than get involved in less profitable collaborative agreements"

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Re: CR: Collaborative agreement [#permalink]

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12 Jul 2006, 10:03
u2lover wrote:
Transnational Cooperation among corporations is experiencing a modest renaissance among U.S firms, even though projects undertaken by two or more corporations under a collaborative agreement are less profitable than projects undertaken by a single corporation. The advantage of transnational cooperation is that such joint international projects may allow U.S firms to win foreign contracts that they would not otherwise be able to win.

Which of the following statements by a US corporate officer best fits the situation of US firms as described in the passage?

(A) "We would rather make only a share of the profit and also risk only a share of a possible loss than run the full risk of a loss"

(B) "We would rather make a share of a relatively modest profit than end up making none of a potentially much bigger profit"

(C) "We would rather cooperate and build good will than poison the business climate by all-out competition"

(D) "We would rather have foreign corporations join us in American projects than join them in projects in their home countries"

(E) "We would rather win a contract with a truly competitive bid of our own than get involved in less profitable collaborative agreements"

B for me.

1. The statement talks about winning contracts in the context of profitability. While sharing losses is implicit it doesnt figure in this context.

2. Yes- Corps are ready to take a smaller profit rather than forgo all profits.

3. Goodwill is irrelevant.

4. doesnt talk about US contracts, talks about all international contracts

5. is talking about the opposite situation.
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12 Jul 2006, 11:56
Agree with B.

A) The statement is concerned with the loss accruing from a project, which is only possible if the firm did get the project in the first place. As mentioned in the question stem, the transnational co-operation is in order to garner more business. Hence out.
C) Competition not in scope.
D) Thrust is on international projects, not US projects.
E) Contrary to the question stem.
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Uh uh. I know what you're thinking. "Is the answer A, B, C, D or E?" Well to tell you the truth in all this excitement I kinda lost track myself. But you've gotta ask yourself one question: "Do I feel lucky?" Well, do ya, punk?

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12 Jul 2006, 19:41
Agree with B.
VP
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12 Jul 2006, 20:07
Pretty sure its :
(B) "We would rather make a share of a relatively modest profit than end up making none of a potentially much bigger profit"

Going international allows US firms to make a smaller profit, than the potential profit opportunity when they go alone, which they cannot because they are international opportunities.
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12 Jul 2006, 20:48
Almost sure for B.
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SAID BUSINESS SCHOOL, OXFORD - MBA CLASS OF 2008

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13 Jul 2006, 00:21
B for me
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13 Jul 2006, 01:07
Surly B. Better to get a bid through collaboration than not winning it at all.
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Re: CR: Collaborative agreement [#permalink]

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13 Jul 2006, 12:05
(A) "We would rather make only a share of the profit and also risk only a share of a possible loss than run the full risk of a loss"

Argument doesn't mention abt risks at all..

(B) "We would rather make a share of a relatively modest profit than end up making none of a potentially much bigger profit"

winner..

(C) "We would rather cooperate and build good will than poison the business climate by all-out competition"

out of scope.

(D) "We would rather have foreign corporations join us in American projects than join them in projects in their home countries"

out of scope.

(E) "We would rather win a contract with a truly competitive bid of our own than get involved in less profitable collaborative agreements"

out of scope.

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13 Jul 2006, 13:37
OA is B
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20 Jul 2006, 10:01
Clearly B.
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21 Jul 2006, 00:06
B is the way to go
[#permalink] 21 Jul 2006, 00:06
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# Transnational Cooperation among corporations is experiencing

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