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# A popular Internet service provider changed its billing

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Manager
Joined: 15 Mar 2012
Posts: 69

Kudos [?]: 8 [0], given: 20

A popular Internet service provider changed its billing [#permalink]

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02 Nov 2012, 23:25
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(N/A)

Question Stats:

74% (01:30) correct 26% (01:29) wrong based on 50 sessions

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A popular Internet service provider changed its billing system, charging customers per each connection to the system rather than per total hours connected. According to company representatives, under the new system, customers will spend more time connected to the Internet while being billed the same or smaller amounts.

Which one of the following statements, if true, would most strengthen the conclusion of the company representatives?

(A) Customers will connect to the service less frequently and spend more time connected to the service each time they do.
(B) The change in the billing system will attract new customers resulting in increased profits for the company.
(C) By spending more time connected to the Internet customers will be able to take advantage of services that previously would have been too expensive.
(D) The popularity of other Internet service providers relies on their having billing systems similar to the one this company is adopting.
(E) The company’s employees, all of whom have free unlimited Internet access, support the change in billing.

My logic:
(A) Customers will connect to the service less frequently and spend more time connected to the service each time they do.
[Me]: May be "connecting the service less frequently" means since people would have unlimited service available for a fixed charge, they wouldnt disconnect and hence would connect less frequently, so, just keep it for once
(B) The change in the billing system will attract new customers resulting in increased profits for the company.
[Me]: Company profit in not the question here, so, irrelevant
(C) By spending more time connected to the Internet customers will be able to take advantage of services that previously would have been too expensive.
[Me]: This sounds good because if users keep using the service for longer than usual, there wouldn't be any extra changes which might've been the case earlier
(D) The popularity of other Internet service providers relies on their having billing systems similar to the one this company is adopting.
[Me]: Irrelevant
(E) The company’s employees, all of whom have free unlimited Internet access, support the change in billing.
[Me]: Irrelevant

I'm not able to get the question. Though I couldn't find the answers for sure when I searched online for an answer, some people do think that the answer should be A. I had chosen C. Could someone please explain why/why not & what the correct answer is. Thanks in advance.

Kudos [?]: 8 [0], given: 20

Moderator
Joined: 02 Jul 2012
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Kudos [?]: 1658 [0], given: 116

Location: India
Concentration: Strategy
GMAT 1: 740 Q49 V42
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WE: Engineering (Energy and Utilities)
Re: CR: Service provider changed billing system [#permalink]

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03 Nov 2012, 00:24
C says that the customers would be spending more time on the internet. It does not say that they would be spending more time during each connection. Suppose cost per connection is 1\$ and cost per hour used to be 4\$.
If a customer connects to the internet 10 times a day and spends 12 minutes each time thereby totally spending 120 minutes. He would need to pay 10\$ as per the current plan whereas as per the previous plan he would have had to pay only 8\$.

A takes care of this concern saying that number of connections will be less and time spent on each connection will be more.

Also it would help if you could hide the part before the question in your post as a spoiler.

Kudos Please... If my post helped.
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Did you find this post helpful?... Please let me know through the Kudos button.

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Kudos [?]: 1658 [0], given: 116

Manager
Joined: 15 Mar 2012
Posts: 69

Kudos [?]: 8 [0], given: 20

Re: CR: Service provider changed billing system [#permalink]

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03 Nov 2012, 05:01
Ah, "per connection" means the number of times one connects.
What I understood was the number of parallel connections allowed e.g. only two laptop/computers allowed connected to net from one home. Oops thinking too much that would be.
thanks.

Kudos [?]: 8 [0], given: 20

VP
Status: Final Lap Up!!!
Affiliations: NYK Line
Joined: 21 Sep 2012
Posts: 1077

Kudos [?]: 646 [0], given: 70

Location: India
GMAT 1: 410 Q35 V11
GMAT 2: 530 Q44 V20
GMAT 3: 630 Q45 V31
GPA: 3.84
WE: Engineering (Transportation)
Re: CR: Service provider changed billing system [#permalink]

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05 Nov 2012, 18:18
divineacclivity wrote:
Hi,

I'm not able to get the following question. Though I couldn't find the answers for sure when I searched online for an answer, some people do think that the answer should be A. I had chosen C. Could someone please explain why/why not & what the correct answer is. Thanks in advance.
-------------------------------

A popular Internet service provider changed its billing system, charging customers per each connection to the system rather than per total hours connected. According to company representatives, under the new system, customers will spend more time connected to the Internet while being billed the same or smaller amounts.

Which one of the following statements, if true, would most strengthen the conclusion of the company representatives?

(A) Customers will connect to the service less frequently and spend more time connected to the service each time they do.
(B) The change in the billing system will attract new customers resulting in increased profits for the company.
(C) By spending more time connected to the Internet customers will be able to take advantage of services that previously would have been too expensive.
(D) The popularity of other Internet service providers relies on their having billing systems similar to the one this company is adopting.
(E) The company’s employees, all of whom have free unlimited Internet access, support the change in billing.

My logic:
(A) Customers will connect to the service less frequently and spend more time connected to the service each time they do.
[Me]: May be "connecting the service less frequently" means since people would have unlimited service available for a fixed charge, they wouldnt disconnect and hence would connect less frequently, so, just keep it for once
(B) The change in the billing system will attract new customers resulting in increased profits for the company.
[Me]: Company profit in not the question here, so, irrelevant
(C) By spending more time connected to the Internet customers will be able to take advantage of services that previously would have been too expensive.
[Me]: This sounds good because if users keep using the service for longer than usual, there wouldn't be any extra changes which might've been the case earlier
(D) The popularity of other Internet service providers relies on their having billing systems similar to the one this company is adopting.
[Me]: Irrelevant
(E) The company’s employees, all of whom have free unlimited Internet access, support the change in billing.
[Me]: Irrelevant

After lot of thinking I feel that
Assumption of C is people will use internet since it will cost drastically less as compared to their previous usage.

But read the conclusion of statement carefully the cost will either be SAME or smaller amounts. That implies the cost will not be drastically less.
I feel its a trap set by GMAT; use of word SAME neutralizes the decline in the cost which the company is over emphasizing.

Pls ask if there is any further doubt.
By the way good question and what is the source.

Kudos [?]: 646 [0], given: 70

VP
Status: Final Lap Up!!!
Affiliations: NYK Line
Joined: 21 Sep 2012
Posts: 1077

Kudos [?]: 646 [0], given: 70

Location: India
GMAT 1: 410 Q35 V11
GMAT 2: 530 Q44 V20
GMAT 3: 630 Q45 V31
GPA: 3.84
WE: Engineering (Transportation)
Re: CR: Service provider changed billing system [#permalink]

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05 Nov 2012, 18:59
divineacclivity wrote:
Archit143 wrote:

After lot of thinking I feel that
Assumption of C is people will use internet since it will cost drastically less as compared to their previous usage.

But read the conclusion of statement carefully the cost will either be SAME or smaller amounts. That implies the cost will not be drastically less.
I feel its a trap set by GMAT; use of word SAME neutralizes the decline in the cost which the company is over emphasizing.

Pls ask if there is any further doubt.
By the way good question and what is the source.

The source is PiyushT

Do you find any flaw in my reasoning or you think it can be defeated.
If yes than pls come up with doubt, so that i can also improve my reasoning ability

Kudos [?]: 646 [0], given: 70

Manager
Joined: 02 Jan 2011
Posts: 193

Kudos [?]: 62 [0], given: 22

Re: CR: Service provider changed billing system [#permalink]

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07 Nov 2012, 23:15
Given : ISP will charge the customers per connection rather than total time spent connected to internet. With this new scheme, customers wil spend more time connected to internet at no additional cost when compared to the previous billing scheme.

(A) Customers will connect to the service less frequently and spend more time connected to the service each time they do. - Since ISP is charging based on the number of connections made rather than time spent browsing, the customers will extend the connection made to avoid unnecessary costs. Hence the connections made will be less frequent and prolonged ones - Correct
(B) The change in the billing system will attract new customers resulting in increased profits for the company. - The premise is not talking about the money that the company would make by changing the billing scheme of its current line of services - Incorrect
(C) By spending more time connected to the Internet customers will be able to take advantage of services that previously would have been too expensive. - The premise speaks about the time spent by an average customer connected to internet. The actual intention of customer with the usage of internet is irrelevant - Incorrect
(D) The popularity of other Internet service providers relies on their having billing systems similar to the one this company is adopting. - Billing scheme of other ISP's is irrelevant and out of scope - Incorrect
(E) The company’s employees, all of whom have free unlimited Internet access, support the change in billing. - Out of scope - Incorrect

Hope this helps.

Kudos [?]: 62 [0], given: 22

Manager
Status: suffer now and live forever as a champion!!!
Joined: 01 Sep 2013
Posts: 147

Kudos [?]: 68 [0], given: 75

Location: India
GPA: 3.5
WE: Information Technology (Computer Software)
Re: A popular Internet service provider changed its billing [#permalink]

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01 Apr 2014, 20:42
Ha, tough one.

I explain my logic here .

Here the argument talks about the Connection time and billing based on Connection to system and not on hourly basis.

The conclusion talks about customers spending more time on Internet .

We need an arguments which states that Customers are spending more time on internet and the arguments has to state that they are being connected for long hours( as from the premises we know that billing based on connection not on hourly basis).

Choice A does that --- hence correct answer.

Please give kudos if this helps you.

Kudos [?]: 68 [0], given: 75

Re: A popular Internet service provider changed its billing   [#permalink] 01 Apr 2014, 20:42
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