Country X imposes heavy tariffs on imported manufactured goods. Compan

Hello, kntombat. Yes, the word sustainable works here as a necessary tie-in to profits in the long term from the passage—the word is not used in the environmental sense. The idea is that if a market in Country X exists only at present for the manufactured goods in question, there is less of a prospect for success in seeing through this plan; if demand remains high, though, it seems reasonable for Company Y to take such a risk.

To be honest, I was surprised to see that 20 percent of members chose (E), as it introduces a concern that is marginally related to the plan at best. (And would it make a difference if labor costs were the same?) (A) and (C) are the two strongest contenders, in my view, but if you think of the plan in simple terms, Company Y wants to increase its profits. To increase profits, the company has to sell its manufactured goods, plain and simple. (A) reminds me of the kind of answer I would chase when I was getting started in my preparation. It sounds perfectly reasonable, but if you think about it, permits could just as easily be swapped out with land, workers, materials to build the factory, and so on. That makes (A) seem kind of arbitrary. But without a sustainable market for its goods in (C), the plan falls apart, for reasons discussed above.

I hope that helps. Thank you for thinking to ask me.

- Andrew

Hey All,

This is a tough question, and since it's one of ours, I figured I had to weigh in.

Conclusion: Company Y could increase profits by putting factory in Country X
Premise: Country X has heavy tariffs on imports
Assumption: People actually buy Company Y's stuff in Country X

This is a tough question because of answer choice A. You're supposed to look at it and say "Well, if they can't even open the factory, won't that negate the conclusion?" And you'd be right, if not for one little word in the passage: could. If this passage said, Company Y WILL make a big profit next year by building a factory, then answer choice A would be correct, because that makes it impossible for them to actually build the factory.

But this passage merely says they "could" make a profit by opening the factory. In this hypothetical universe, the factory has already opened. Whether or not there are impediments to making this happen is immaterial. The issue is whether the existence of the factory will make them a profit.

A: Company Y will be able to obtain all the necessary permits to open a factory in Country X.
Problem: We don't need to know how hard it is to make the factory. The conclusion implies that the factory is already open.

B: Company Y currently produces no goods outside its home country.
Problem: This has no connection to whether or not they will make money if they DO produce goods outside the home country.

C: A sustainable market for Company Y's goods currently exists in Country X.
Answer: You can't make a profit if nobody's buying, no matter how many tariffs you dodge.

D: Company Y's home country does not impose tariffs on imported goods.
Problem: This doesn't matter, because Company Y wants to make a profit on goods sold in Country X.

E: Labor costs in Country X are lower than those in Company Y's home country.
Problem: This strengthens the argument a bit (because the factory in Country X will be cheaper, leading to potential profit), but it isn't necessary. If we take the negation ("Labor costs in Country X are NOT lower than in Country Y), the argument does not fall apart.

Hope that helps!