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# A new water desalination technology promises to greatly improve

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Intern
Joined: 20 May 2017
Posts: 17
A new water desalination technology promises to greatly improve  [#permalink]

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26 May 2017, 02:55
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15% (low)

Question Stats:

83% (02:03) correct 17% (02:05) wrong based on 109 sessions

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A new water desalination technology promises to greatly improve the efficiency of desalination, in particular by using less energy, therefore offering significant savings on operating costs. However, the novel technology mentioned above is plagued by high capital costs, as its set up costs are much higher than conventional desalination technologies. These costs, generally incurred in the last month before plant operations start, might deter those industries that have low capital costs, from replacing their old desalination plants with the new one.

Which of the following, if true, provides the strongest support for a prediction that industries with capital costs might not adopt the new water desalination system?

A) Desalination has much higher operating costs than water purification

B) The proposed water desalination system is cheaper to install that than old desalinations plants, with a significant savings on labor costs

C) The desalination system was developed by a team of Israeli engineers, widely acknowledged to have groundbreaking technologies in the field

D) Companies with low operating costs are more sensitive towards increasing capital expenditures than companies that already have high capital costs

E) Large and small companies have similar economics in most industries

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Status: Emory Goizueta Alum
Joined: 18 Jul 2015
Posts: 3590
Re: A new water desalination technology promises to greatly improve  [#permalink]

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26 May 2017, 06:11
The argument is saying a new system will do some help but since it is costly to install, low capital won't install it.

We need to find out something that states even the high capital people won't use it.

A) Desalination has much higher operating costs than water purification --> Water purification comparison is OFS.

B) The proposed water desalination system is cheaper to install that than old desalinations plants, with a significant savings on labor costs --> What we want is no where present in this option.

C) The desalination system was developed by a team of Israeli engineers, widely acknowledged to have groundbreaking technologies in the field. -> Whosoever has developed is is again OFS.

D) Companies with low operating costs are more sensitive towards increasing capital expenditures than companies that already have high capital costs. --> ok, so it is the low capital who is looking for a change. So, since high capital are not interested in any change, they won't be willing to use it. Hence, correct.

E) Large and small companies have similar economics in most industries. --> Economics of companies is irrelevant.
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Re: A new water desalination technology promises to greatly improve  [#permalink]

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09 Aug 2019, 09:37
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: A new water desalination technology promises to greatly improve   [#permalink] 09 Aug 2019, 09:37