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# Due to budget constraints for the upcoming year, the corporate office

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Retired Moderator
Joined: 18 Sep 2014
Posts: 1096
Location: India
Due to budget constraints for the upcoming year, the corporate office  [#permalink]

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22 Nov 2015, 11:09
5
00:00

Difficulty:

25% (medium)

Question Stats:

76% (02:06) correct 24% (02:10) wrong based on 267 sessions

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Due to budget constraints for the upcoming year, the corporate office of the Super Video chain has elected to reduce the amount of advertising funding it provides to individual chain stores in rural areas. To offset this loss in advertising funding, the manager of one such store, Store 123, has elected to raise late fees from \$2.00 per day to \$2.50 per day. Despite the fee increase, the store manager has not seen a reduction in the number of videos returned late. The manager has concluded that the late fee increase will help to offset the cut in company funding.

Which of the following statements, if true, most strengthens the manager’s claim?

A. Since the late fee increase, salespeople at Store 123 have noticed a drop in sales of used DVDs and VHS tapes.
B. Store 123 had to spend a small amount of its monthly advertising budget to let customers know about the new late fee.
C. Store 123 is part of Super Video’s corporate video tracking system, which allows Store 123 to know exactly how many videos are overdue in real time.
D. Since the advertising budget reduction, Store 123 has had to lay off one salesperson, reducing costs by ten percent.
E. Since the fee increase, the average number of days a video is late has not changed.

Except c and E all other choices weaken instead of strengthening the conclusion. I chose C but logic behind selecting the answer choice E by Kaplan is really beautiful.
Senior Manager
Joined: 05 Apr 2015
Posts: 361
Re: Due to budget constraints for the upcoming year, the corporate office  [#permalink]

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22 Nov 2015, 22:38
One can easily boil down the options to either C or E. When we have done that, all we have to do is try to see some reason which will aid the local store and not the central organization of store123 in general.

option E states clearly that the average number of days a video is late has not changed. Hence the manager's plan will work.
Intern
Joined: 13 Mar 2016
Posts: 25
Location: India
Concentration: General Management, Entrepreneurship
WE: General Management (Energy and Utilities)
Re: Due to budget constraints for the upcoming year, the corporate office  [#permalink]

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25 Jan 2017, 08:32
E. Since the fee increase, the average number of days a video is late has not changed.

This proves that manager plan will work.
Intern
Joined: 02 Jan 2017
Posts: 5
Re: Due to budget constraints for the upcoming year, the corporate office  [#permalink]

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27 Jan 2017, 17:59
What is the source of this question? This is a low level question? It still took me 2 minutes (got it right tho)!
Retired Moderator
Status: Long way to go!
Joined: 10 Oct 2016
Posts: 1333
Location: Viet Nam
Re: Due to budget constraints for the upcoming year, the corporate office  [#permalink]

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28 Jan 2017, 03:19
poojaa_p wrote:
What is the source of this question? This is a low level question? It still took me 2 minutes (got it right tho)!

You could see tags that the source is from Kaplan.

This is a low level question, because it's easy to go with C and E left.

Choice C supports the sentence: "Despite the fee increase, the store manager has not seen a reduction in the number of videos returned late.". This choice is irrelevant to the manager's claim. Hence the answer is E.
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Manager
Joined: 03 Dec 2018
Posts: 169
Re: Due to budget constraints for the upcoming year, the corporate office  [#permalink]

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05 Mar 2019, 21:48
E is correct. On what basis do I eliminate option C. what if they don't have a tracking system to know exactly how many videos are overdue in real time. The plan wouldn't offset the loss.

please clarify my doubt.
Thank You
Re: Due to budget constraints for the upcoming year, the corporate office   [#permalink] 05 Mar 2019, 21:48
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# Due to budget constraints for the upcoming year, the corporate office

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