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# A successful clothing department store, in a central downtown location

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A successful clothing department store, in a central downtown location  [#permalink]

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09 Aug 2015, 06:08
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Difficulty:

55% (hard)

Question Stats:

62% (02:05) correct 38% (01:58) wrong based on 410 sessions

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A successful clothing department store, in a central downtown location of a certain city, is of a limited size and has grown so much over the past year that it needs to expand. There are a few other slightly larger available retails lots in the downtown regions for sale, but the prices per square foot are quite high. The management finds that cost per square foot of lots in a suburb a few miles from downtown is almost half of that in the downtown region, so they plan to relocate there to save costs.

Which of the following, if true, most seriously undermines this plan?

A) The store will have to adapt to the building codes of the suburb, which may not be the same as the city.
B) The lot for the suburb location will require a sprawling parking lot.
C) Consumers from the city who do not own cars will have to pay bus fare to commute to this store now.
D) Almost all of the store's other locations, in other metropolitan regions throughout the state, are in downtown areas; very few are in suburbs.
E) Some of the available downtown locations, though only a few blocks away, would be closest to entirely different bus and subway lines.

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Re: A successful clothing department store, in a central downtown location  [#permalink]

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10 Aug 2015, 06:59
Harley1980 wrote:
A successful clothing department store, in a central downtown location of a certain city, is of a limited size and has grown so much over the past year that it needs to expand. There are a few other slightly larger available retails lots in the downtown regions for sale, but the prices per square foot are quite high. The management finds that cost per square foot of lots in a suburb a few miles from downtown is almost half of that in the downtown region, so they plan to relocate there to save costs.

Which of the following, if true, most seriously undermines this plan?

A) The store will have to adapt to the building codes of the suburb, which may not be the same as the city.
B) The lot for the suburb location will require a sprawling parking lot.
C) Consumers from the city who do not own cars will have to pay bus fare to commute to this store now.
D) Almost all of the store's other locations, in other metropolitan regions throughout the state, are in downtown areas; very few are in suburbs.
E) Some of the available downtown locations, though only a few blocks away, would be closest to entirely different bus and subway lines.

Can you please explain why B is correct and why A is incorrect
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Re: A successful clothing department store, in a central downtown location  [#permalink]

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10 Aug 2015, 07:16
1
amatya wrote:
Harley1980 wrote:
A successful clothing department store, in a central downtown location of a certain city, is of a limited size and has grown so much over the past year that it needs to expand. There are a few other slightly larger available retails lots in the downtown regions for sale, but the prices per square foot are quite high. The management finds that cost per square foot of lots in a suburb a few miles from downtown is almost half of that in the downtown region, so they plan to relocate there to save costs.

Which of the following, if true, most seriously undermines this plan?

A) The store will have to adapt to the building codes of the suburb, which may not be the same as the city.
B) The lot for the suburb location will require a sprawling parking lot.
C) Consumers from the city who do not own cars will have to pay bus fare to commute to this store now.
D) Almost all of the store's other locations, in other metropolitan regions throughout the state, are in downtown areas; very few are in suburbs.
E) Some of the available downtown locations, though only a few blocks away, would be closest to entirely different bus and subway lines.

Can you please explain why B is correct and why A is incorrect

Hello amatya

Answer A says about some building codes but we don't know whether this regulations will increase cost of this building.

And answer D directly says that this lot will include big parking lot and management will pay for this parking lot
So this is the only answer that directly says that in new center present additional costs besides center cost.

This question is weaken so only possibility of cost increasing is completely enough.
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Re: A successful clothing department store, in a central downtown location  [#permalink]

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10 Aug 2015, 07:25
2
amatya wrote:
Harley1980 wrote:
A successful clothing department store, in a central downtown location of a certain city, is of a limited size and has grown so much over the past year that it needs to expand. There are a few other slightly larger available retails lots in the downtown regions for sale, but the prices per square foot are quite high. The management finds that cost per square foot of lots in a suburb a few miles from downtown is almost half of that in the downtown region, so they plan to relocate there to save costs.

Which of the following, if true, most seriously undermines this plan?

A) The store will have to adapt to the building codes of the suburb, which may not be the same as the city.
B) The lot for the suburb location will require a sprawling parking lot.
C) Consumers from the city who do not own cars will have to pay bus fare to commute to this store now.
D) Almost all of the store's other locations, in other metropolitan regions throughout the state, are in downtown areas; very few are in suburbs.
E) Some of the available downtown locations, though only a few blocks away, would be closest to entirely different bus and subway lines.

Can you please explain why B is correct and why A is incorrect

The conclusion is based on saving costs.

B raises a doubt that "sprawling" parking space will be required and so additional costs may be involved.

For A-Though one can argue that there will be cost may be involved in adapting to the new building code BUT we have no definite info. about such costs.

Hope the above helps !!!
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Re: A successful clothing department store, in a central downtown location  [#permalink]

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10 Aug 2015, 07:49
couldn't understand as to why it can't be option C?
as people will have to pay bus fares, there could be a case of fewer footfalls which would impinge upon the plan negatively.
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Re: A successful clothing department store, in a central downtown location  [#permalink]

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10 Aug 2015, 07:58
grr8pe wrote:
couldn't understand as to why it can't be option C?
as people will have to pay bus fares, there could be a case of fewer footfalls which would impinge upon the plan negatively.

Hello grr8pe

You evaluate plan from the point of view of final profit.
But argument does not bother about final profit: " they plan to relocate there to save costs."
So we should evaluate plan only from position of saving costs.

(This is bad position in real life and that is why this question is difficult)
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Re: A successful clothing department store, in a central downtown location  [#permalink]

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15 Aug 2018, 18:02
1

Official Explanation

The cost per square foot may be almost half as much in the suburbs, so it initially sounds cheaper, but the "sprawling parking lot" in the suburbs will be part of the lot, and hence will count in the cost. The word "sprawling" implies very big. It could easily be more than twice as big as the floor space of the store, so the overall cost of this suburban lot, even with the lower per-foot rate, would be much higher than it would be for a downtown lot. In that case, relocating to the suburbs would not save costs, so this fact by itself could possibly undermine the conclusion completely.

The building codes in the suburbs are different—does that mean it's more or less expensive to build something in the suburbs than downtown? We don't know. Furthermore, we don't know if the store plans to build, or will be renting a space in an already constructed building, in which case building costs associated with codes would be irrelevant. Choice (A) is incorrect.

At the heart of (C), we have a cost issue for consumers, not for the store. It doesn't directly affect the store's balance sheet. If the commute to the suburb dissuades a significant number of customers from coming, that could be a problem, but we have no clear evidence to conclude that this would happen. Choice (C) is incorrect because we would need to assume information that isn't in the passage or answer choice.

Choice (D) merely tells us about an overall pattern, and gives us no information about why this pattern is in place. Is there something relative adverse about suburban locations? Or, is it just the case that not many stores have even attempted such a move? We don't know, so we can't say that this undermines the plan. Choice (D) is incorrect.

Choice (E) tells about what would happen if the store moved to other downtown locations. This is not part of the plan under consideration, nor is it clear whether the difference cited would have any cost consequences for the store. This is 100% irrelevant. Choice (E) is incorrect.
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Re: A successful clothing department store, in a central downtown location   [#permalink] 15 Aug 2018, 18:02
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