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# Corporations exist to make money for their shareholders

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Intern
Joined: 31 Aug 2015
Posts: 16
GMAT 1: 750 Q48 V46
Corporations exist to make money for their shareholders  [#permalink]

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30 Sep 2015, 19:57
5
00:00

Difficulty:

15% (low)

Question Stats:

80% (01:23) correct 20% (01:49) wrong based on 215 sessions

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Corporations exist to make money for their shareholders. Corporations have no money to give away because any excess funds belong to the shareholders. Therefore, corporations should not contribute to charities.

Which of the following most seriously weakens the reasoning in the argument above?

(A) Managers are being trained to consider the ethical, moral and social effects of their decisions in addition to the economic factors.
(B) Some of the largest corporations in the country are known to be major contributors to philanthropic organizations.
(C) Shareholders tend to make larger individual donations to charities than do people who hold no shares in corporations.
(D) Most corporations contribute solely to large, well-known, and highly organized charitable organizations rather than to individuals in need.
(E) The favorable publicity and tax advantages gained by corporate charity often result in an increase in profits greater than the actual costs of making the donations.
Manager
Joined: 15 May 2010
Posts: 159
Location: India
Concentration: Strategy, General Management
WE: Engineering (Manufacturing)
Corporations exist to make money for their shareholders  [#permalink]

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01 Oct 2015, 02:15
1
Under what condition, the corporation that gives away the excess money shall in some other way be conducive to generating more money.

If we find that, the argument shall be weakened.

Option E does that.

------------------------------------
Empire of the Sun
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Status: It's near - I can see.
Joined: 13 Apr 2013
Posts: 1405
Location: India
GMAT 1: 480 Q38 V22
GPA: 3.01
WE: Engineering (Real Estate)
Re: Corporations exist to make money for their shareholders  [#permalink]

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24 Mar 2018, 10:10
800orDie wrote:
Corporations exist to make money for their shareholders. Corporations have no money to give away because any excess funds belong to the shareholders. Therefore, corporations should not contribute to charities.

Which of the following most seriously weakens the reasoning in the argument above?

(A) Managers are being trained to consider the ethical, moral and social effects of their decisions in addition to the economic factors.
(B) Some of the largest corporations in the country are known to be major contributors to philanthropic organizations.
(C) Shareholders tend to make larger individual donations to charities than do people who hold no shares in corporations.
(D) Most corporations contribute solely to large, well-known, and highly organized charitable organizations rather than to individuals in need.
(E) The favorable publicity and tax advantages gained by corporate charity often result in an increase in profits greater than the actual costs of making the donations.

We need to find an alternate cause that shows charities are also profitable. E says exact the same. Sometimes it is better to go from E to A for POE.
_________________

"Do not watch clock; Do what it does. KEEP GOING."

Re: Corporations exist to make money for their shareholders   [#permalink] 24 Mar 2018, 10:10
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