Bunuel
Top Line Technologies and Eureka Industries distribute the same kind of rechargeable batteries to national electronic store chains. Employee wages comprise 38 percent of each company's total annual costs. In order to gain a competitive advantage over Eureka Industries, Top Line Technologies has proposed slashing employee wages by 10 percent.
Which of the following, if true, would most strengthen the argument above?
A. Top Line Technologies' rechargeable batteries have received more consistent consumer approval ratings than have Eureka Industries'.
B. Top Line Technologies will have to reduce the number of rechargeable batteries it distributes to client stores.
C. Eureka Industries is headquartered in a city that has a higher cost of living than does the city where Top Line Technologies is headquartered.
D. Top Line Technologies will begin distributing lower-quality rechargeable batteries.
E. Lowered employee wages have no effect on the quantity of rechargeable batteries that can be distributed to the client stores.
Top Line Technologies' main objective is to gain competitive advantage over Eureka Industries. Top line has thus proposed to slash employee wages by 10%. The main point to note here is that there should be no effect on revenues/no. of units sold/any factor that could compromise their competitive advantage.
A. Top Line Technologies' rechargeable batteries have received more consistent consumer approval ratings than have Eureka Industries'.
This has nothing to do with slashing costs and gaining competitive advantage
B. Top Line Technologies will have to reduce the number of rechargeable batteries it distributes to client stores.
This compromises their objective, if top line reduces the no. of batteries, they are reducing revenue
C. Eureka Industries is headquartered in a city that has a higher cost of living than does the city where Top Line Technologies is headquartered.
Again, this has nothing to do with the main objective of top line wanting to gain competitive advantage by reducing costs
D. Top Line Technologies will begin distributing lower-quality rechargeable batteries.
This can indirectly hamper the reputation of top line, and by doing so top line will be able to gain advantage for the short term, wont be able to sustain during the long run, this statement is irrelevant
E. Lowered employee wages have no effect on the quantity of rechargeable batteries that can be distributed to the client stores.
Yes! The reduction of costs should not hamper any other aspect of top line's production/functions. This statement would strengthen the above argument and help meets Top Line's objective.
Answer choice (E)