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28 Apr 2012, 22:22
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Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
45%
(medium)
Question Stats:
68% (01:50) correct
32%
(02:02)
wrong
based on 2601
sessions
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Surveys reveal that the vast majority of hotel guests in the United States resent the high prices of the items in the mini-bars in their hotel rooms. These guests would prefer to have an empty refrigerator in their rooms in order to have space to put their own food and beverages, although a large percentage of these guests would still make at least one purchase from their in-room mini-bar. After analyzing the results of the study, the management of Hotel T decided that it would be more profitable to eliminate the mini-bar and install empty refrigerators in each room.
Which of the following, if true, would support Hotel T's plan to increase profitability by eliminating in room mini-bars in favor of empty refrigerators?
(A) There is currently some space available in Hotel T's in-room mini-bars for guests to put their own items.
(B) Hotel T is located in the United States.
(C) Some guests of Hotel T do not make any purchases from their in-room mini-bars.
(D) The money that Hotel T makes from the mini-bar purchases of its guests is less than the money that Hotel T loses from discarding mini-bar items that have not sold by their expiration dates.
(E) It will cost Hotel T less money to maintain empty refrigerators in its guest rooms than to maintain stocked mini-bars in those rooms.
Which of the following, if true, would support Hotel T's plan to increase profitability by eliminating in room mini-bars in favor of empty refrigerators?
(A) There is currently some space available in Hotel T's in-room mini-bars for guests to put their own items.
(B) Hotel T is located in the United States.
(C) Some guests of Hotel T do not make any purchases from their in-room mini-bars.
(D) The money that Hotel T makes from the mini-bar purchases of its guests is less than the money that Hotel T loses from discarding mini-bar items that have not sold by their expiration dates.
(E) It will cost Hotel T less money to maintain empty refrigerators in its guest rooms than to maintain stocked mini-bars in those rooms.
Main CR Qs link - https://gmatclub.com/forum/cr-qs-600-700 ... 31508.html
29 Dec 2013, 19:05
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gmatfighter12
A) There is currently some space available in Hotel T’s in-room mini-bars for guests to put their
own items. Out of scope
b) Hotel T is located in the United States. Not relevant
c) Some guests of Hotel T do not make any purchases from their in-room mini-bars. Not relevant
d) The money that Hotel T makes from the mini-bar purchases of its guests is less than the
money that Hotel T loses from discarding mini-bar items that have not sold by their HOLD
expiration dates.
e) It will cost Hotel T less money to maintain empty refrigerators in its guest rooms than to
maintain stocked mini-bars in those rooms. Hold
While e is true, in the premise manager does take into account of 1 item sold thus D is a better choice.
Better explanation for avoiding E is that the hotel can't SELL anything from an empty refrigerator, but they could SELL things from the minibar -- a consideration that is just ignored in E. In that case, even if maintainance of mini-bars cost more, it may be better to keep mini-bars as they create more revenues.own items. Out of scope
b) Hotel T is located in the United States. Not relevant
c) Some guests of Hotel T do not make any purchases from their in-room mini-bars. Not relevant
d) The money that Hotel T makes from the mini-bar purchases of its guests is less than the
money that Hotel T loses from discarding mini-bar items that have not sold by their HOLD
expiration dates.
e) It will cost Hotel T less money to maintain empty refrigerators in its guest rooms than to
maintain stocked mini-bars in those rooms. Hold
While e is true, in the premise manager does take into account of 1 item sold thus D is a better choice.
D definitely covers this position.
HTH
BTW, an advanced version of this question can be located here: alan-government-subsidies-have-been-proposed-in-cariana-to-163278.html
11 Apr 2021, 06:15
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GetThisDone
Surveys reveal that the vast majority of hotel guests in the United States resent the high prices of the items in the mini-bars in their hotel rooms. These guests would prefer to have an empty refrigerator in their rooms in order to have space to put their own food and beverages, although a large percentage of these guests would still make at least one purchase from their in-room mini-bar. After analyzing the results of the study, the management of Hotel T decided that it would be more profitable to eliminate the mini-bar and install empty refrigerators in each room.
Which of the following, if true, would support Hotel T's plan to increase profitability by eliminating in room mini-bars in favor of empty refrigerators?
(A) There is currently some space available in Hotel T's in-room mini-bars for guests to put their own items.
(B) Hotel T is located in the United States.
(C) Some guests of Hotel T do not make any purchases from their in-room mini-bars.
(D) The money that Hotel T makes from the mini-bar purchases of its guests is less than the money that Hotel T loses from discarding mini-bar items that have not sold by their expiration dates.
(E) It will cost Hotel T less money to maintain empty refrigerators in its guest rooms than to maintain stocked mini-bars in those rooms.
Which of the following, if true, would support Hotel T's plan to increase profitability by eliminating in room mini-bars in favor of empty refrigerators?
(A) There is currently some space available in Hotel T's in-room mini-bars for guests to put their own items.
(B) Hotel T is located in the United States.
(C) Some guests of Hotel T do not make any purchases from their in-room mini-bars.
(D) The money that Hotel T makes from the mini-bar purchases of its guests is less than the money that Hotel T loses from discarding mini-bar items that have not sold by their expiration dates.
(E) It will cost Hotel T less money to maintain empty refrigerators in its guest rooms than to maintain stocked mini-bars in those rooms.
Main CR Qs link - https://gmatclub.com/forum/cr-qs-600-700 ... 31508.html
OFFICIAL EXPLANATION
Hotel T wants to increase profitability by eliminating in-room mini-bars and replacing them with empty refrigerators. To increase Hotel T's profitability, the information provided must demonstrate that the difference between Hotel T's revenues and costs will increase as a result of the plan.
(A) The fact that there is space available in Hotel T's in-room mini bars for guests to put their own items has no relationship to Hotel T's plan to increase its profitability.
(B) Since the survey discussed in the passage discussed hotel guests in the United States, it has relevance for Hotel T. However, this fact has no bearing on whether Hotel T's plan will increase its profitability.
(C) Since some guests of Hotel T do not make any purchases from their in-room mini-bars, eliminating these mini-bars will not result in any lost revenue from these guests. However, this information tells us nothing about the purchasing habits of other guests of Hotel T and it has no obvious relationship to Hotel T's plan to increase profitability.
(D) CORRECT. This fact establishes that Hotel T is currently losing money on the mini-bars. While it makes money on the mini-bar purchases of its guests, Hotel T actually loses more money because it must discard mini-bar items that have not sold by their expiration dates. By eliminating the mini-bars in favor of refrigerators, Hotel T will lose the income from mini-bar purchases but save even more money because it no longer will have to discard old mini-bar items. This will increase Hotel T's profitability.
(E) Hotel T will reduce its costs by switching from stocked mini-bars to empty refrigerators. However, this may or may not increase Hotel T's profitability. For example, if the lost revenue from the elimination of the mini-bars exceeds the reduction in costs, then the switch will actually decrease Hotel T's profits.
