gmatprep CR electric cars

Question

mbagal1 · Answer

I would have to say B. At that rate they will have to allow consumers to rent cars every 10 weeks.

anindyat · Answer

B too ...

mm007 · Answer

Should be B.. rising cost will make the offer inviable..

I thought of A too, as it says what if most electric vehicles are commercial, there will no extended trip on them... but i guess, there r some which are not..

yogeshsheth · Answer

B too

karlfurt · Answer

The plan is to make the car more attractive. How does B address this point? It only says it will be more expensive for the producer. But at the same time, the car can become more attractive, so the plan can be a success,no?

Sumithra · Answer

As asked in the question, since the plan would be expensive, it cannot be financially successful.

MBAlad · Answer

B for me - what's the OA?

karlfurt · Answer

OA B

Can someone please help me in my understanding.
The argument says:

1. An electric car cannot make long trips.
2. This makes the car unattractive
3. How to make the car more attractive? Improve its image.
4. How to improve the image? By giving 3 days free.

Question : Why will the plan to make the car more attractive fail? Because even though the car will cost a little less(3 days free), customers will still not be able to make big trips. So I would look for an answer pointing the weakness of the car(short distance) which is not addressed by the campaign.

However, the OA says that the cost of this campaign will add to the cost to the producer and willl add to the high price of the vehicle. Does that mean that these higher costs will be translated to the selling price? I rather understand that the costs will instead decrease the margin. So the cost will remain the same to the customer. If this is true, I don't see why the plan would fail because the goal to make the car more popular or more attractive can still be reached. The only looser would be the producer, but only on a financial aspect on the short term.

dips · Answer

I guess you have yourself explained the answer itself. 
The question has been asked " Which of the following, most threatens the plan's prospects for success.  " . 
B says that as most of the commuters drive 100 miles a week, so in 10 weeks they will cover 1000 miles. and so the producer would have to give a conventional car to most of the commuters every 10 weeks. This will have a lot of overheads on the company and so will be a loss to the company.

What you are saying about the financial loss for a short term, that's streching a bit more. may the company does not have that much margin that it can withstand even the short term loss.

karlfurt · Answer

Thanks! Reading your post, I just noticed that the company will provide the customer with conventional cars! :shock:

I simpy missed that info, though I read it several times... :evil:

Indeed B makes sense, but I think for a reason different from the financial impact. How to convince customer to drive electric car, if a the company provides a conventional car for an extended time?

Sumithra · Answer

I understand your point. How to convince electric vehicles drivers by offering conventional cars? This does not promote electric vehicle. But I see that B speaks only of hard to manage increase in finances. Am I missing something?

Whatever, all the best for your exam tomorrow!

gmatprep CR electric cars

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