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# Studies in restaurants show that the tips left by customers

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Manager
Joined: 18 Aug 2007
Posts: 70

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Studies in restaurants show that the tips left by customers [#permalink]

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20 Oct 2007, 10:20
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Studies in restaurants show that the tips left by customers who pay their bill in cash tend to be larger when the bill is presented on a tray that bears a credit-card logo. Consumer psychologists hypothesize that simply seeing a credit-card logo makes many credit-card holders willing to spend more because it reminds them that their spending power exceeds
the cash they have immediately available.

Which of the following, if true, most strongly supports the psychologists’ interpretation of the studies?

A. The effect noted in the studies is not limited to patrons who have credit cards.

B. Patrons who are under financial pressure from their credit-card obligations tend to tip less when presented with a restaurant bill on a tray with credit-card logo than when the tray has no logo.

C. In virtually all of the cases in the studies, the patrons who paid bills in cash did not possess credit cards.

D. In general, restaurant patrons who pay their bills in cash leave larger tips than do those who pay by credit card.

E. The percentage of restaurant bills paid with given brand of credit card increases when that credit card’s logo is displayed on the tray with which the bill is prepared.

Would be great if someone can throw light on the POE that is to be use in these CR types.

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Manager
Joined: 07 Sep 2007
Posts: 79

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20 Oct 2007, 10:37
B.

If Crd make people tip more because it reminds them of exceed cash they have than the reverse would also be true. Having debt on Crd card makes them tip less.

Cause - effect relationship and answer B address the problem of effect - cause relation.

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Senior Manager
Joined: 06 Aug 2007
Posts: 360

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Re: SET 23 Ques 31 - CR - Credit Card Logo [#permalink]

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20 Oct 2007, 10:48
s_positive wrote:
Studies in restaurants show that the tips left by customers who pay their bill in cash tend to be larger when the bill is presented on a tray that bears a credit-card logo. Consumer psychologists hypothesize that simply seeing a credit-card logo makes many credit-card holders willing to spend more because it reminds them that their spending power exceeds
the cash they have immediately available.

Which of the following, if true, most strongly supports the psychologists’ interpretation of the studies?
[/b]

B. Patrons who are under financial pressure from their credit-card obligations tend to tip less when presented with a restaurant bill on a tray with credit-card logo than when the tray has no logo.

makes the most sense....if it has effect of greater spending power because their CC limit allows them too but what if you're maxed out your CC - the CC logo reminds you of the money you owe..

Kudos [?]: 34 [0], given: 0

Re: SET 23 Ques 31 - CR - Credit Card Logo   [#permalink] 20 Oct 2007, 10:48
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