Stockholders have been critical of the Flyna Company, a major furnitur

Hi Experts.

I have a question on this.

I'm still confused with the OA.

The passage states that "Flyna uses only lumber from certified mills."
And in order to certify mills, Flyna need to make surprise visits to mills to verify documents.
(So it's justified that its Country X wood supply is obtained legally is justified.)

From this, I think, it can be inferred that Flyna would not use wood from uncertified mills.
So why do we need to care about those 90% that Flyna still not make surprise visits (as suggested in D) ?

Please help.
Thank you

Hi

The passage does not state that Flyna only uses lumber from mills certified in the last one year. From the information given in the passage, it is a reasonable inference that once certified, Flyna continues to source lumber from that mill till it is de-certified. Given that Flyna only inspects 10% of X's mills in a year, assuming truly randomized selection, each mill should be inspected only on average every ten years or so. So Flyna may be sourcing lumber from a mill which was certified 10 years (or even more) ago. This throws Flyna's claims of sourcing only legally lumbered wood into doubt.

Hope this clarifies.
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Hello,
Option D says "The proportion of Country X's lumber mills inspected each year by Flyna's staff is about 10 percent, randomly selected"
and the premise says that Flyna uses only lumber from certified mills.
So even if only 10% mills are inspected (and say some are certified from this 10%), Flyna is still using wood from these 10% mills, right? So as long as Flyna uses wood from the inspected mills only, it should support the conclusion that "Flyna's claim that its Country X wood supply is obtained legally is justified."

Please provide some clarity on this verbal experts GMATNinja VeritasKarishma egmat

Stockholders have been critical of the Flyna Company, a major furniture retailer, because most of Flyna’s furniture is manufactured in Country X from local wood, and illegal logging is widespread there. However, Flyna has set up a certification scheme for lumber mills. It has hired a staff of auditors and forestry professionals who review documentation of the wood supply of Country X’s lumber mills to ensure its legal origin, make surprise visits to mills to verify documents, and certify mills as approved sources of legally obtained lumber. Flyna uses only lumber from certified mills. Thus, Flyna’s claim that its Country X wood supply is obtained legally is justified.

P : Flyna Company manufactures goods via illegal logging?
P : Flyna set up a certification
A : certification made is valid
What might make the certification invalid?
1. wide-spread fraud in making certification
2. People who make certification lacks such ability to do so
3. mills tend to use illegal lumber after certification is given
C : wood supply from country X is legally justified.


Which of the following, if true, would most undermine the justification provided for Flyna’s claim?

A. Only about one-third of Flyna’s inspectors were hired from outside the company.
-> We can only infer that two-third of inspectors were hired inside the company. However, being hired inside the company does not mean that the person must be unscrupulous.

B. Country X’s government recently reduced its subsidies for lumber production.
-> Country X's reduced subsidies is not directly linked with the issue given in the argument.

C. Flyna has had to pay higher than expected salaries to attract qualified inspectors.
-> It can be inferred that Flyna must have had to pay more than expected. However, no guarantee is given that Flyna must have hired fewer people than it has planned.

D. The proportion of Country X’s lumber mills inspected each year by Flyna’s staff is about 10 percent, randomly selected.
-> Correct. Option D tells us that only small portion of lumber mills are actually inspected. Thus, leaving vast majority of other mills under question.

E. Illegal logging costs Country X’s government a significant amount in lost revenue each year.
-> Option E gives reason for country X to eliminate illegal logging. However, such information gives no clue to infer whether the country X actually tried to do so and what impact would the trial had to Flyna.

GMATNinja I was personally thrown off by the "randomly selected" line. The way I thought of it was: "well if they're randomly selected, even though it's 10%, it's unlikely that there's foulplay". Obviously, D is incorrect. However, how can we make sure to not misinterpret phrases like "randomly selected"?

Stockholders have been critical of the Flyna Company, a major furniture retailer, because most of Flyna's furniture is manufactured in Country X from local wood, and illegal logging is widespread there. However, Flyna has set up a certification scheme for lumber mills. It has hired a staff of auditors and forestry professionals who review documentation of the wood supply of Country X's lumber mills to ensure its legal origin, make surprise visits to mills to verify documents, and certify mills as approved sources of legally obtained lumber. Flyna uses only lumber from certified mills. Thus, Flyna's claim that its Country X wood supply is obtained legally is justified.

Which of the following, if true, would most undermine the justification provided for Flyna's claim?

A. Only about one-third of Flyna's inspectors were hired from outside the company. -> So, 2/3 of inspectors are hired within Country X. But, how can we assume, these inspectors will support illegal logging. It is very far assumption. Incorrect.

B. Country X's government recently reduced its subsidies for lumber production. -> Can we relate it to Country X wood supply is illegal. Incorrect.

C. Flyna has had to pay higher than expected salaries to attract qualified inspectors. -> This will strengthen the argument, we need to weaken it. Incorrect.

D. The proportion of Country X's lumber mills inspected each year by Flyna's staff is about 10 percent, randomly selected. -> In other words, 90% are not inspected. Are we saying by 10% audit, Country X wood supply is legal. This is not good, we missed the bigger part 90%. It is weakening the conclusion. Let's keep it.

E. Illegal logging costs Country X's government a significant amount in lost revenue each year -> Then Government will also oppose illegal logging, it will support the conclusion, not weaken. Incorrect.

So, I think D.

I think it is just a bad question

If one believes that 10% on a random sample is good - then why this has to undermine the credibility? - I think if the random sample is not mentioned - then it will undermine - but alas, shortcut or not, still a random sampling performed on 10% looks sensible and operationally make sense

now on A - agree to disagree too that 2/3rd of insider and only 1/3rd of outsider may not be so wrong - I guess this comes back to a which has the better answer - while A can be seen as wrong - but an audit from inside does not make it too wrong - agree that this weakens the conclusion

so if you weigh A or D - I guess D is definitely a better answer, albeit only a slight - unfortunately this is a bad question I guess

GMATNinja, the argument says that the company makes surprise visits. So even if 10 out of 100 mills are inspected, this inspection is done so without informing the mills. So shouldn't this strengthen our argument? Because by making surprise visits the company is not making a preference of visiting any particular mill. If 10/100 are visited, we can say that there is no reference given to any mill and that all the mills have any equal chance of getting caught

On the other hand (A) says that 2/3 are internally hired. The company has set up its own certification scheme. This 2/3 of this scheme is managed by its own employees. The way I see it, the entire game is in the hands of Flyna. So even if the company claims that the wood is legal because it is all verified and certified, the fact that (most of) this entire process is controled by the company does throw some doubt of trusting the claim. Yes, we need to assume that there is a possibility that the company/employees aren't 100% diligent. BUT I believe this is something very practical to assume event though nothing is mentioned in the argument

D. The proportion of Country X's lumber mills inspected each year by Flyna's staff is about 10 percent, randomly selected.

I have gone through the explanations by experts in this thread, but I still seem to be missing something. I have broken my head but I am not understanding how Option D is undermining the claim.

....It has hired a staff of auditors and forestry professionals who review documentation of the wood supply of Country X's lumber mills to ensure its legal origin, make surprise visits to mills to verify documents, and certify mills as approved sources of legally obtained lumber. Flyna uses only lumber from certified mills. Thus, Flyna's claim that its Country X wood supply is obtained legally is justified.

Let's consider an example to understand better:
Total number of lumber mills in Country X = 100
Total number of lumber mills whose documentation is reviewed for their legal origin = 100
Total number of lumber mills that had surprise visits = 10 (Just trying to make a case for option D: 10% of all lumber mills)
Total number of lumber mills legally certified = 10 (assuming all mills that had surprise visits ere approved as legally obtained sources)
This implies, total number of lumber mills used by Flyna = 10 ("Flyna uses only lumber from certified mills.")

What am I missing in this example? How is option D undermining the claim?

AndrewN - Request you to please enlighten me and help pinpoint in my example what I am missing, if possible. Thanks in advance.

AndrewN GMATNinja

I'm trying to keep an open mind but D still feels like a stretch compared to A.

Can it not be that perhaps Flyna only sources its wood from 10% of Country X's lumber mills? In other words, Country X could be illegally logging most of its wood, but Flyna visits 10% of the country's mills (seeing as D does not say 10% of the mills Flynna sources from) and only buys from those that pass its checks. In which case, Flyna would be justified in claiming that "its Country X wood supply is obtained legally".

Appreciate your thoughts!

Why can't we choose option A when it's weakening the conclusion? how is it out of scope, I don't understand. Because as far as I know and see, new information can be used to weaken the argument. no?

You're correct that we don't know the exact lumber mills which Flyna uses, or the overall percentage. It's also true that if the lumber mills that Flyna uses are inspected, we'd expect the wood to be legally obtained. So if the 10% that Flyna uses happen to be the ones that get inspected, (D) would not weaken the argument, as you suggest.

Notice, however, that (D) specifies that the lumber mills inspected each year are "randomly selected." So if the inspections are done at random, that rules out the idea that Flyna is specifically inspecting only the mills it uses.

The argument concludes that Flyna's claim that it obtains wood legally is justified because of the inspections. But if the inspections only verify a randomly selected 10% of the lumber mills, that leaves 90% that might have illegally obtained lumber, and that Flyna might use. Since this weakens the argument that Flyna obtains its wood legally, (D) is correct.

I hope that helps!
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@GMATNinja

Option D states that the proportion of mills inspected is 10%. It can be so that the staff inspect only 10% and provide certifications to those. And, since, Flyna only buys from certified mills, it can buy from those 10% mills that are certified. We don't care if the staff inspected the 90% or not because Flyna doesn't necessary needs to buy from those mills.

Option A is the correct answer in my opinion since the group of inspectors are not independent and they might be biased in their inspection for reasons such as costs