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Reverse innovation refers to advancements that are first made in the

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Reverse innovation refers to advancements that are first made in the  [#permalink]

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New post 16 Aug 2018, 18:44
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Reverse innovation refers to advancements that are first made in the developing world, and then adopted by the developed world. Some economists argue that such innovation enables new technological advancements to be developed and produced at lower cost, thus delivering innovation to the developed world at more affordable prices.

Which of the following, if true, would best support the economists’ argument above?

(A) Many products developed as a result of reverse innovation are affordable.
(B) Customers who purchase products derived from reverse innovation tend to be cost conscious.
(C)Companies that market products originally developed from reverse innovation typically do not add substantial mark-ups to those products.
(D) Reverse innovation only makes up a small portion of all innovation worldwide.
(E) The number of economists who believe products sourced from reverse innovation will grow substantially over the next decade has increased.

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Re: Reverse innovation refers to advancements that are first made in the  [#permalink]

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New post 16 Aug 2018, 23:14
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Premise: developed countries innovate & outsource the tech to developing nation where stuff is made for cheaper. Economists argue that this process helps in innovating at a cheaper/affordable price.

POE for checking which argument strengthens this claim:

(A) Many products developed as a result of reverse innovation are affordable. - we already know this. Makes the info provided redundant
(B) Customers who purchase products derived from reverse innovation tend to be cost conscious. - out of scope
(C)Companies that market products originally developed from reverse innovation typically do not add substantial mark-ups to those products. - Okay, strengthens the fact the prices are not increased by companies, making it affordable. Not really convinced upto this point of time about option C being the correct answer; moving on...
(D) Reverse innovation only makes up a small portion of all innovation worldwide. - irrelevant, does not talk about prices
(E) The number of economists who believe products sourced from reverse innovation will grow substantially over the next decade has increased. - irrelevant since it does not speak about prices

option C stands.
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New post 18 Aug 2018, 12:49
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Why B cannot be the answer?

If customers are cost conscious,they ll always prefer to buy cheaper products and hence support the argument.
What is wrong with my reasoning?
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Re: Reverse innovation refers to advancements that are first made in the  [#permalink]

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New post 18 Aug 2018, 22:20
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SWAT09 wrote:
Why B cannot be the answer?

If customers are cost conscious,they ll always prefer to buy cheaper products and hence support the argument.
What is wrong with my reasoning?


The stem is concerned with the cost of innovation & not the cost price.
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New post 18 Aug 2018, 22:46
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mgcon wrote:
SWAT09 wrote:
Why B cannot be the answer?

If customers are cost conscious,they ll always prefer to buy cheaper products and hence support the argument.
What is wrong with my reasoning?


The stem is concerned with the cost of innovation & not the cost price.


then isn't C also talking about cost price of the product?For me C seems to be an assumption. B gives additional information that there is market for these products and hence further technological advancements can be carried out at low prices..
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Reverse innovation refers to advancements that are first made in the  [#permalink]

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New post 18 Aug 2018, 22:50
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SWAT09 wrote:
mgcon wrote:
SWAT09 wrote:
Why B cannot be the answer?

If customers are cost conscious,they ll always prefer to buy cheaper products and hence support the argument.
What is wrong with my reasoning?


The stem is concerned with the cost of innovation & not the cost price.


then isn't C also talking about cost price of the product?For me C seems to be an assumption. B gives additional information that there is market for these products and hence further technological advancements can be carried out at low prices..


Let's take an example of apple (ironic, since i am talking about affordable). Apple designed the iPhone in the US but is manufacturing it in China through Foxconn. This enables Foxconn to optimize on the design flow and make the process even cheaper. Because of this process, the US can get iPhone at a more affordable price. This would only be true if Apple does not mark up its prices.
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Re: Reverse innovation refers to advancements that are first made in the  [#permalink]

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New post 20 Aug 2018, 09:29
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(A) Many products developed as a result of reverse innovation are affordable.
The conclusion talks explicitly about new technological advancements; if 'many' were replaced with 'all', it could have been a strengthener : Incorrect

(B) Customers who purchase products derived from reverse innovation tend to be cost conscious.
We are not concerned whether the customers are cost conscious, since we are talking about the technological advancements' availability at affordable prices; how they perceive their cost doesn't matter : Incorrect

(C)Companies that market products originally developed from reverse innovation typically do not add substantial mark-ups to those products.
It somehow strengthens our belief that the cost of those advancements are affordable, since mark-ups are not added by a significant margin (Assumption, basically) : Correct

(D) Reverse innovation only makes up a small portion of all innovation worldwide.
Irrelevant

(E) The number of economists who believe products sourced from reverse innovation will grow substantially over the next decade has increased.
Irrelevant
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Re: Reverse innovation refers to advancements that are first made in the  [#permalink]

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New post 20 Aug 2018, 11:30
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aragonn wrote:
Reverse innovation refers to advancements that are first made in the developing world, and then adopted by the developed world. Some economists argue that such innovation enables new technological advancements to be developed and produced at lower cost, thus delivering innovation to the developed world at more affordable prices.

Which of the following, if true, would best support the economists’ argument above?

(A) Many products developed as a result of reverse innovation are affordable.
(B) Customers who purchase products derived from reverse innovation tend to be cost conscious.
(C) Companies that market products originally developed from reverse innovation typically do not add substantial mark-ups to those products.
(D) Reverse innovation only makes up a small portion of all innovation worldwide.
(E) The number of economists who believe products sourced from reverse innovation will grow substantially over the next decade has increased.


Clean (C), if we negate the options the enticonclusionion (In the highlighted part fails), thus the Answer must be (C), if a substantial mark up is made then the selling price increases and the conclusion shatters to pieces....
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