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Modern manufacturers, who need reliable sources of materials and

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Re: Modern manufacturers, who need reliable sources of materials and  [#permalink]

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New post 03 Nov 2018, 10:06
teaserbae wrote:
GMATNinja workout broall Gnpth
What actually " owning the producers " mean here can you please explain ?

Kaczet has pointed out another common phrase in the business world used to describe this type of arrangement (thanks!).

But to make this incredibly simple: owning the producers means literally owning the companies that produce. It's as simple as that. And if you own the companies that produce, then you don't have to negotiate contracts to purchase the components produced by those companies. Everything produced is already property of your company. I hope this helps clarify!
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Re: Modern manufacturers, who need reliable sources of materials and  [#permalink]

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New post 07 Mar 2019, 00:00
However, moving away from backward integration is not a complete solution either. Developing innovative technologies requires independent suppliers of components to invest huge sums in research and development. The resulting low profit margins on the sale of components threaten the long-term financial stability of these firms. Because the ability of end-product assemblers to respond to market opportunities depends heavily on suppliers of components, assemblers are often forced to integrate by purchasing the suppliers of components just to keep their suppliers in business.

The part in bold makes D the correct choice
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Re: Modern manufacturers, who need reliable sources of materials and  [#permalink]

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New post 27 Jun 2019, 02:17
3. Which of the following best describes the way the last paragraph functions in the context of the passage?

(A) The last in a series of arguments supporting the central argument of the passage is presented.
(B) A viewpoint is presented which qualifies one presented earlier in the passage.
(C) Evidence is presented in support of the argument developed in the preceding paragrap.
(D) Questions arising from the earlier discussion are identified as points of departure for further study of the topic.
(E) A specific example is presented to illustrate the main elements of argument presented in the earlier paragraphs.

can some one please provide an answer to this?

I marked A. isnt the central idea of passage that it is difficult to make a choice between doing backward integration and not doing the backward integration?

Isnt last para an argument that supports the central idea as a whole?
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New post 29 Jun 2019, 15:52
For #3, it's important to recognize that all we have in terms of a central argument is the initial statement that manufacturers face a difficult choice between owning the producers and buying from independent producers. The author then goes back and forth, outlining advantages and disadvantages of backward integration (owning the producers). However, the second half of p2 and all of p3 are entirely about the disadvantages.

p4 presents a pivot, showing why it may not be great to move away from backward integration, despite its disadvantages. So the role of this paragraph in the passage as a whole is to show why the previous arguments may not lead to the conclusion one would expect--namely, a move away from backward integration. The meaning of "qualifies" here is "presents a limitation or exception to." When we qualify a statement, we're saying it is not universal or may turn out not be true under circumstances. For instance, if I say "I'm the best basketball player in my neighborhood--at least that I know of," that disclaimer at the end is a qualification of my original statement. (For another instance of this word in RC, check out Q1, answer B here: https://gmatclub.com/forum/it-is-an-odd ... 07145.html. People sometimes choose that answer, not realizing that it means the exact opposite of what they expect it to mean.)
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New post 29 Jun 2019, 15:57
Note that A, C, and E are all wrong for more or less the same reason. The paragraph is not part of a series of statements all supporting the same point. If they were, p4 would have to go in the same direction as the other paragraphs, and the point would have to be that backward integration was good or necessary. However, since the other paragraphs show evidence AGAINST integration and the point is just that the choice is tough, we have a more nuanced situation. Imagine a passage stating that anyone who wants an mba will have to study hard. The first paragraphs show why you may not actually need to take the GMAT, but the later ones show that in that case, you have to take the GRE, which also requires a lot of study. The point is not "Take the GMAT" or "Take the GRE" but rather "You'll have to study either way." That's kind of the situation we're in. P4 is one part of a two-pronged argument.
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Re: Modern manufacturers, who need reliable sources of materials and  [#permalink]

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New post 06 Aug 2019, 09:00
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Which of the following best describes the way the last paragraph functions in the context of the passage?

A. The last in a series of arguments supporting the central argument of the passage is presented.

IMO the central argument of the passage is that "Modern manufacturers, face an increasingly difficult choice between owning the producers of these items and buying from independent producers. "

Option A does support the central argument that YES they face a difficult choice because moving completely away from backward integration is not good.

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Re: Modern manufacturers, who need reliable sources of materials and  [#permalink]

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New post Updated on: 15 Aug 2019, 12:52
3
Quote:
what does 'to qualify' mean in this particular case?
thanks.

Quote:
B. A viewpoint is presented which qualifies one presented earlier in the passage.

Dear Friend,

As pointed out, the key to answer this question lies in understanding the word "to qualifies".
I, also, did choose a wrong answer because I didn't know the meaning of "to qualifies" while attempting the question.

Qualify (as a verb) :-

Meaning 1 - To measure up, to achieve the required criteria.
Meaning 2 - To restrict something or to limit something.

Here "to qualifies" means that the last paragraph provides limits or issues of the argument provided in earlier paragraph.
Which is true as we know.

Thanks for your attention. I hope that it helped.

Regards
Gagan

Originally posted by GAGAN121 on 15 Aug 2019, 02:29.
Last edited by GMATNinjaTwo on 15 Aug 2019, 12:52, edited 1 time in total.
fixed quote format
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Re: Modern manufacturers, who need reliable sources of materials and  [#permalink]

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New post 19 Aug 2019, 21:03
GAGAN121 wrote:
Quote:
what does 'to qualify' mean in this particular case?
thanks.

Quote:
B. A viewpoint is presented which qualifies one presented earlier in the passage.

Dear Friend,

As pointed out, the key to answer this question lies in understanding the word "to qualifies".
I, also, did choose a wrong answer because I didn't know the meaning of "to qualifies" while attempting the question.

Qualify (as a verb) :-

Meaning 1 - To measure up, to achieve the required criteria.
Meaning 2 - To restrict something or to limit something.

Here "to qualifies" means that the last paragraph provides limits or issues of the argument provided in earlier paragraph.
Which is true as we know.

Thanks for your attention. I hope that it helped.

Regards
Gagan

Thanks GAGAN121!

For another example of this usage of "qualify", check out this post.
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Re: Modern manufacturers, who need reliable sources of materials and  [#permalink]

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New post 12 Oct 2019, 23:31
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Can anyone explain why 2 is B?

2 should be A IMO

"Independent suppliers may be unwilling to share innovations with assemblers with whom they are competing"
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Re: Modern manufacturers, who need reliable sources of materials and  [#permalink]

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New post 16 Oct 2019, 14:14
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Bunuel SajjadAhmad

Question 2's answer choice is WRONG. It is actually A

Look here: https://www.gmac.com/executive-assessme ... -questions
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Re: Modern manufacturers, who need reliable sources of materials and  [#permalink]

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New post 16 Oct 2019, 14:27
1
PM
p1:To discuss decision to Backwards integrate
p2: state advantage of BI, but qualify with risks
p3: discuss risks of BI --> trade off on innovation
p4: describe the necessity of BI even when Innovation is needed.

Q1 - Detail
The answer to this is found in the last paragraph quite clearly actually.
"Developing innovative technologies requires independent suppliers of components to invest huge sums in research and development. The resulting low profit margins on the sale of components threaten the long-term financial stability of these firms."

This Matches up with Answer choice (D) perfectly.

A is incorrect because huge, not "modest" investments are required.
B is incorrect for the same reason
C is incorrect because low, not high, profit margins result
E is incorrect because the only relationship we are told is that of BI. We are merely told that contractual arrangements have the same financial benefits, but we don't know if they have the same financial requirements.

Q2 - Detail Inference
The answer is A - https://www.gmac.com/executive-assessme ... -questions
We are told in p2 "independent suppliers may be unwilling to share innovations with assemblers with whom they are competing..."

A is the only thing that can be supported.
B has a typo and B cannot be supported
C No- this is nowhere stated
D - Not supported
E - No. In fact independent suppliers would be the source of innovation

Q3 - Detail Except
Most of the benefits are listed or mentioned in p2
A - listed in p2 - "centralizes overhead" - incorrect
C - "removes need for some purchasing and marketing functions" - incorrect
D - I misinterpreted this as "reliability of source components" instead of "reliability of A source of components" - It is discussed in the last paragraph and acquisition is recommended, so this is incorrect.
E- mentioned in P2, so incorrect

B is correct - We are told "backward integration boosts profits" BUT not of the sale of the components, but rather the sale of the finished goods. The whole reason Manufacturers BI is to enhance the production of their good.

Q4 - Detail Inference
Refer to passage map above.
A - incorrect. The other paras don't function as arguments.
B - This is correct. In p3 the risks of BI are discussed, then in p4 we are told that we can't completely go without BI because of certain conditions (supplier reliability) - hence p4 serves to qualify earlier discussions.
C - no. A new contention is provided.
D - No. They aren't mentioned as points of departure and no mention of further study.
E - No specific example is provided. A general principle is stated to warn against completely moving away from BI.
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Re: Modern manufacturers, who need reliable sources of materials and  [#permalink]

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