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Executives of Company G receive high salaries and excellent benefits,

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Executives of Company G receive high salaries and excellent benefits,  [#permalink]

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New post 18 Jul 2018, 02:51
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Executives of Company G receive high salaries and excellent benefits, in addition to stock options and numerous other perks. However, a majority of shareholders of Company G have objected to paying for its executives to travel on Company G's corporate jets. These shareholders believe that these jets should only be used for purposes related to increasing the profits of Company G.

Which of the following must be true to support the reasoning behind the shareholders' objection?


A. Company G executives primarily use the corporate jets for personal travel.

B. Other perks provided to the executives of Company G are not directly related to the profitability of Company G.

C. Most companies pay significant amounts of money to lease corporate jets.

D. Executives of the vast majority of companies must pay for their own travel costs on corporate jets.

E. Company G has not been profitable for the past 3 years.

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Executives of Company G receive high salaries and excellent benefits,  [#permalink]

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New post 18 Jul 2018, 03:36
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Bunuel wrote:
Executives of Company G receive high salaries and excellent benefits, in addition to stock options and numerous other perks. However, a majority of shareholders of Company G have objected to paying for its executives to travel on Company G's corporate jets. These shareholders believe that these jets should only be used for purposes related to increasing the profits of Company G.


Pre-thinking :
Although executives of Company G receive high salaries and excellent benefits, and numerous other perks, majority of shareholders of Company G have objected to paying for its executives to travel on Company G's corporate jets because the shareholders believe that these jets should only be used for purposes related to increasing the profits of Company G. i.e official purpose.

A. Company G executives primarily use the corporate jets for personal travel. --> Correct, matches our pre-thinking, personal travel does not qualify official purpose and does not add any value to the Company

Hence, A.
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Re: Executives of Company G receive high salaries and excellent benefits,  [#permalink]

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New post 19 Jul 2018, 19:05
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A or E ??
A - Executives use for personal travel -supports stakeholders

E-Company is not profitable since 3 years .
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Re: Executives of Company G receive high salaries and excellent benefits,  [#permalink]

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New post 19 Jul 2018, 23:09
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Perfect question to demonstrate the basic reasoning required to solve any assumption question.

Premise

Executive receive high salaries, excellent benefits, stock options, numerous other perks. Numerous shareholders have an objection when these executives travel on company's corporate jets. However, these shareholders believe that these jets should only be used for purposes which increase profits for the company.

Conclusion

Shareholders don't want the executives to use company jets for anything but profit making. [This is not mentioned explicitly and is inferred logically from the premise.]

Assumption

When executives travel in company jets, they don't do it to bring profits to the company. Hence any answer choice supporting this hypothesis would not be wrong. We need to find the answer choice that sufficiently bridges the gap between the premise and the conclusion.

Bunuel wrote:
Executives of Company G receive high salaries and excellent benefits, in addition to stock options and numerous other perks. However, a majority of shareholders of Company G have objected to paying for its executives to travel on Company G's corporate jets. These shareholders believe that these jets should only be used for purposes related to increasing the profits of Company G.

Which of the following must be true to support the reasoning behind the shareholders' objection?

A. Company G executives primarily use the corporate jets for personal travel.
Sufficiently fills the gap between the premise and the conclusion. Explains why the shareholders had an objection to executives' use of the corporate jets.

B. Other perks provided to the executives of Company G are not directly related to the profitability of Company G.
Other perks which are not directly related do not explain why shareholders would have objection with only the use of corporate jets and not all these other perks collectively.

C. Most companies pay significant amounts of money to lease corporate jets.
Most companies which pay significant amounts of money to lease corporate jets may not be related to Company G. In addition, this company may or may not be related to any of the shareholders in question too.

D. Executives of the vast majority of companies must pay for their own travel costs on corporate jets.
Same reasoning as option C. Other companies are not mentioned in the passage, hence we cannot be sure that this must be true.

E. Company G has not been profitable for the past 3 years.
Whether or not the company has been profitable for the past 3 years does not explain the shareholders' objection - at least not enough to be chosen as "must be true" for an answer choice.


Cheers! :-)


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Re: Executives of Company G receive high salaries and excellent benefits,  [#permalink]

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New post 19 Jul 2018, 23:16
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Hey Mittali!

Kindly allow me to explain.

The shareholders' objection to corporate jets is not sufficiently explained by answer choice (E). Moreover one cannot consider this as a "must be true" to explain the gap between the premise and the conclusion. I welcome you to go through my detailed answer.

Cheers! :-D

Mittali wrote:
A or E ??
A - Executives use for personal travel -supports stakeholders

E-Company is not profitable since 3 years .


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Re: Executives of Company G receive high salaries and excellent benefits,  [#permalink]

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New post 23 Jul 2018, 10:31
Technically speaking, this is an Assumption question. Not a "Must be true" question. Kindly change the tag.
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Re: Executives of Company G receive high salaries and excellent benefits,  [#permalink]

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New post 23 Jul 2018, 20:45
Bunuel wrote:
Executives of Company G receive high salaries and excellent benefits, in addition to stock options and numerous other perks. However, a majority of shareholders of Company G have objected to paying for its executives to travel on Company G's corporate jets. These shareholders believe that these jets should only be used for purposes related to increasing the profits of Company G.

Which of the following must be true to support the reasoning behind the shareholders' objection?


A. Company G executives primarily use the corporate jets for personal travel.

B. Other perks provided to the executives of Company G are not directly related to the profitability of Company G.

C. Most companies pay significant amounts of money to lease corporate jets.

D. Executives of the vast majority of companies must pay for their own travel costs on corporate jets.

E. Company G has not been profitable for the past 3 years.


Hi,
For choice A, what if the executive uses the jet for business trip that does not increase profit?
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Re: Executives of Company G receive high salaries and excellent benefits,  [#permalink]

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New post 24 Aug 2018, 06:05
Here is how my understanding goes.

As long as the option doesn't clearly state a particular fact, then it is never advisable to assume something. Remember that the more stories you need to spin to make an option your answer, the more it is not your answer.

In Option A, it is clearly given that the purpose behind using the jets is "personal" - Hence it is not safe to assume that it is used for non-profitable business.

Also, the reason why Company G clearly prohibits people from using Corporate Jets is because they don't want the jets to be misused for personal reasons. Hence the answer.

Hope that helps.

Thanks,

Saikiran Dudyala.
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Re: Executives of Company G receive high salaries and excellent benefits, &nbs [#permalink] 24 Aug 2018, 06:05
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