domleon wrote:
TrueSave is a mail-order company that ships electronic products from its warehouses to customers worldwide. The company’s shipping manager is proposing that customer orders be packed with newer, more expensive packing materials that virtually eliminate damage during shipping. The manager argues that overall costs would essentially remain unaffected, since the extra cost of the new packing materials roughly equals the current cost of replacing products returned by customers because they arrived in damaged condition.
Which of the following would it be most important to ascertain in determining whether implementing the shipping manager’s proposal would have the argued-for effect on costs?
(A) Whether the products shipped by TrueSave are more vulnerable to incurring damage during shipping than are typical electronic products
(B) Whether electronic products are damaged more frequently in transit than are most other products shipped by mail-order companies
(C) Whether a sizable proportion of returned items are returned because of damage already present when those items were packed for shipping
(D) Whether there are cases in which customers blame themselves for product damage that, though present on arrival of the product, is not discovered until later
(E) Whether TrueSave continually monitors the performance of the shipping companies it uses to ship products to its customer
Here is the (A) vs (C) comparison.
Manager's Proposal: Use newer, more expensive packing that eliminates damage during transport.
Argued-for effect - Overall costs would essentially remain unaffected, since the extra cost of the new packing materials roughly equals the current cost of replacing products returned by customers because they arrived in damaged condition.
Extra cost of new packing = Cost of replacing products because they arrived damaged
What is most important to ascertain (evaluate) to know if argued-for effect will happen?
(A) Whether the products shipped by TrueSave are more vulnerable to incurring damage during shipping than are typical electronic products
It doesn't matter whether TrueSave's products are more vulnerable, less vulnerable or have same vulnerability compared with typical electronic products.
What we know is extra cost of packing is same as cost of replacing products arriving damaged on arrival. Whether the cost of products arriving damaged at arrival is less/more or same as this cost for typical electronic products, we don't care. All we want to establish is that our cost will essentially stay the same. How it compares with the cost that others incur is irrelevant.
(B) Whether electronic products are damaged more frequently in transit than are most other products shipped by mail-order companies
The comparison is not between such costs incurred for electronic products vs other products. The only aim is that TrueSave's cost should not increase.
(C) Whether a sizable proportion of returned items are returned because of damage already present when those items were packed for shipping
We know Extra cost of new packing = Cost of replacing products because they arrived damaged
But here is the twist - what if the products that arrive damaged are damaged before they are shipped? They would be damaged upon arrival and the new packing will not save them. They will be returned and that cost will be incurred.
Answer: "Yes, a sizable proportion of returned items are returned because of damage already present when those items were packed for shipping"
Then cost of replacing products will stay high. So the reduction in this cost will not cancel off the extra cost of packing. Hence the argued-for effect will not be seen.
Answer" "No, a sizable proportion of returned items are returned NOT because of damage already present when those items were packed for shipping"
So most products that get returned are due to damage while shipping. The new packing will make it non existent. Hence the extra cost of packing would equal cost of replacing products and the argued-for effect will be seen.
Answer (C)