GMAT Question of the Day - Daily to your Mailbox; hard ones only

 It is currently 19 Jun 2019, 01:03

### GMAT Club Daily Prep

#### Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

# Labor costs are the dominant expense of doing business

Author Message
TAGS:

### Hide Tags

Verbal Forum Moderator
Status: Greatness begins beyond your comfort zone
Joined: 08 Dec 2013
Posts: 2300
Location: India
Concentration: General Management, Strategy
Schools: Kelley '20, ISB '19
GPA: 3.2
WE: Information Technology (Consulting)

### Show Tags

26 Jun 2017, 22:47
5
00:00

Difficulty:

85% (hard)

Question Stats:

48% (02:27) correct 52% (02:30) wrong based on 231 sessions

### HideShow timer Statistics

Labor costs are the dominant expense of doing business in all but a few endeavors. For most jobs, the variation in individual work-related performance is likely to be greater than the range in compensation; additionally, it is possible to maintain productivity and work quality while decreasing labor costs.
Which of the following must be true on the basis of the statements above?
A. Employers should be more concerned about employee productivity
B. Some employers would be willing to accept employee performance output less than that at the higher range of an employee productivity.
C. No employer should expect an organization's employees to operate at maximum productivity
D. Some employees work at output levels less than at their maximum.
E. Labor costs need to be curtailed to improve the vitality of a nation's economy.

_________________
When everything seems to be going against you, remember that the airplane takes off against the wind, not with it. - Henry Ford
The Moment You Think About Giving Up, Think Of The Reason Why You Held On So Long
+1 Kudos if you find this post helpful
Manager
Joined: 12 Nov 2016
Posts: 70

### Show Tags

27 Jun 2017, 06:05
It is D..since it says that the employee productivity is greater than variation in compensation.

Posted from my mobile device
Manager
Joined: 24 Jan 2017
Posts: 142
GMAT 1: 640 Q50 V25
GMAT 2: 710 Q50 V35
GPA: 3.48

### Show Tags

27 Jun 2017, 07:44
1
Skywalker18 wrote:
Labor costs are the dominant expense of doing business in all but a few endeavors. For most jobs, the variation in individual work-related performance is likely to be greater than the range in compensation; additionally, it is possible to maintain productivity and work quality while decreasing labor costs.
Which of the following must be true on the basis of the statements above?
A. Employers should be more concerned about employee productivity
B. Some employers would be willing to accept employee performance output less than that at the higher range of an employee productivity.
C. No employer should expect an organization's employees to operate at maximum productivity
D. Some employees work at output levels less than at their maximum.
E. Labor costs need to be curtailed to improve the vitality of a nation's economy.

Inference question. I chose D. The following is my approach:

A. what employers SHOULD DO cannot be inferred from stimulus. Hence, as per my personal observation, options mentioning "A should do B..." are usually wrong. OUT.

B. Nowhere in the above question could this prediction be inferred. OUT.

C. Another suspicious "SHOULD". Why on earth "No employer should expect an organization's employees to operate at maximum productivity" ??? Even in real life, "maximum productivity" is good, why don't we expect it? Also, "no employee" expression is too extreme. OUT.

D. "the variation in individual work-related performance is likely to be greater than the range in compensation". When working performance is varied, we can absolutely understand that while some employees reach maximum level of output, some work at less than that maximum level. CORRECT.

E. "nation's economy"??? Totally out of scope. OUT.
Current Student
Status: Chasing my MBB Dream!
Joined: 29 Aug 2012
Posts: 1110
Location: United States (DC)
WE: General Management (Aerospace and Defense)

### Show Tags

Updated on: 15 Jul 2017, 20:33
Top Contributor
Labor costs are the dominant expense of doing business in all but few endeavors. For most jobs, the variation in individual work-related performance is likely to be greater than the range in compensation; additionally, it is possible to maintain productivity and work quality while decreasing labor costs.

Which of the following must be true on the basis of statements above?

A. Employers should be more concerned about employee productivity.

B. Some employers would be willing to accept employee performance output less than that at the higher range of an employee productivity.

C. No employee should expect an organization’s employees to operate at maximum productivity.

D. Some employees work at output levels less than their maximum.

E. Labor costs need to curtailed to improve the vitality of a nation’s economy.
_________________

Originally posted by Gnpth on 15 Jul 2017, 13:29.
Last edited by Vyshak on 15 Jul 2017, 20:33, edited 1 time in total.
Topic Merged
VP
Status: Learning
Joined: 20 Dec 2015
Posts: 1007
Location: India
Concentration: Operations, Marketing
GMAT 1: 670 Q48 V36
GRE 1: Q157 V157
GPA: 3.4
WE: Engineering (Manufacturing)

### Show Tags

16 Jul 2017, 05:26
Imo D

But i am still unsure of the answer .
_________________
Manager
Joined: 14 May 2017
Posts: 53
Location: India
GPA: 3.5

### Show Tags

02 Jan 2018, 03:50
According to the passage,

"For most jobs, the variation in individual work-related performance is likely to be greater than the range in compensation" On the basis of this choice D must be true. Choices A and E is out of scope(need not be true). Choice C is extreme(need not be true). Choice B is interesting. In my opinion this statement isn't related to the passage and hence need not be true. Therefore D is the best choice here. However it would be useful to have a convincing explanation from the experts on choice B.
Manager
Joined: 13 Nov 2017
Posts: 57

### Show Tags

02 Jan 2018, 16:44
IMO OA is D

A. Employers should be more concerned about employee productivity
-> irrelavant. should? Too extreme
B. Some employers would be willing to accept employee performance output less than that at the higher range of an employee productivity.
->: may be or not. We cannot assure. It is up to each emplyer's temper.
C. No employer should expect an organization's employees to operate at maximum productivity
-> may be or not. We cannot assure this.
D. Some employees work at output levels less than at their maximum.
-> Correct
'it is possible to maintain productivity and work quality while decreasing labor costs.'
= We can ssume that some employee would not do their best at work.
E. Labor costs need to be curtailed to improve the vitality of a nation's economy.
-> nation's economy? Out of scope
Re: Labor costs are the dominant expense of doing business   [#permalink] 02 Jan 2018, 16:44
Display posts from previous: Sort by