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# The fact that superior service can generate a competitive

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Director
Joined: 03 Jul 2003
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The fact that superior service can generate a competitive [#permalink]

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26 Nov 2003, 16:01
The fact that superior service can generate a competitive advantage for a company does not mean that every attempt at improving service will create such an advantage. Investment in service, like those in production and distribution, must be balanced against other types of investments on the basis of direct, tangible benefits such as cost reduction and increased revenues. ....

Qus: According to the passage, investments in service are comparable to investments in production and distribution in terms of the

A) tangibility of the benefits that they tend to confer.
B) increased revenues that they ultimately produce
C) basis on which they need to be weighed.
D) insufficient analysis that managers devote to them
E) degree of competitive advantage that they are likely to provide.

Could you folks answer this with explanation?

[Reveal] Spoiler: OA
C

Thanks much

Last edited by Zarrolou on 24 Jul 2013, 15:09, edited 2 times in total.
Edited the question.

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Intern
Joined: 24 Nov 2003
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26 Nov 2003, 17:08
OK eleminate C, D, E right away. Look at the explainations.

Now u r left with A & B

Then pick A. If anyone has a better reason I would like to hear about it.

A) tangibility of the benefits that they tend to confer.
Yes - because there are more benefits than increased revenue

B) increased revenues that they ultimately produce
It is a close call but increased revenue dosent mean increased profit, profit=revenue - cost

C) basis on which they need to be weighed.
The basis are already defined in second sentence

D) insufficient analysis that managers devote to them
Irrelevant

E) degree of competitive advantage that they are likely to provide.
Look at the 2nd sentence - they are talking about tangiable gains. So easily elimiate it too.

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Director
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26 Nov 2003, 17:18
I will go for C.
passage says:
..balanced against other types of investments on the basis of direct, tangible benefits ..."
defines the bases on which benefits should be measured.. C confers

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SVP
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10 Dec 2003, 08:04
maverick_ucdc wrote:
OK eleminate C, D, E right away. Look at the explainations.

Now u r left with A & B

Then pick A. If anyone has a better reason I would like to hear about it.

A) tangibility of the benefits that they tend to confer.
Yes - because there are more benefits than increased revenue

B) increased revenues that they ultimately produce
It is a close call but increased revenue dosent mean increased profit, profit=revenue - cost

C) basis on which they need to be weighed.
The basis are already defined in second sentence

D) insufficient analysis that managers devote to them
Irrelevant

E) degree of competitive advantage that they are likely to provide.
Look at the 2nd sentence - they are talking about tangiable gains. So easily elimiate it too.

agree with A

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Manager
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10 Dec 2003, 09:16
Should be A.

The examples in the second part of the sentence "tangible benefits such as cost reduction and increased revenues." clearly indicate that the "cost reduction" and the "increased revenues" are applicable to both kinds of investment.

Official ans ?

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Director
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10 Dec 2003, 09:45
I vote C. Agree with dj.

It's right there in plain English!

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Manager
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12 Jun 2010, 06:49
i guess C

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Senior Manager
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24 Jul 2013, 14:53
dj wrote:
I will go for C.
passage says:
..balanced against other types of investments on the basis of direct, tangible benefits ..."
defines the bases on which benefits should be measured.. C confers

Hi dj,All, I am facing hard time in justifying C as answer. Can you please state your reasons for conferring C as answer? What is wrong with A and B?
I will appreciate any explanations from RC gmatclub gurus towards this RC.
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Re:   [#permalink] 24 Jul 2013, 14:53
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