Shelby Industries manufactures and sells the same gauges as Jones Indu

Question

Shelby Industries manufactures and sells the same gauges as Jones Industries. Employee wages account for forty percent of the cost of manufacturing gauges at both Shelby Industries and Jones Industries. Shelby Industries is seeking a competitive advantage over Jones Industries. Therefore, to promote this end, Shelby Industries should lower employee wages.

Which of the following, if true, would most weaken the argument above?

Which of the following, if true, would most weaken the argument above?

(A) Because they make a small number of precision instruments, gauge manufacturers cannot receive volume discounts on raw materials.

(B) Lowering wages would reduce the quality of employee work, and this reduced quality would lead to lowered sales.

(C) Jones Industries has taken away twenty percent of Shelby Industries' business over the last year.

(D) Shelby Industries pays its employees, on average, ten percent more than does Jones Industries.

(E) Many people who work for manufacturing plants live in areas in which the manufacturing plant they work for is the only industry.

sanki779 · Accepted Answer

The way I do it is that in order to choose the best option I try to look around for the words which have already been mentioned in the passage. If the option does not have the words mentioned in the passage I mark it as not relevant even if it makes logical choice. It works all the times.

In option  C  it mentions above 20% of the business being taken away which I can not relate back to passage. Option  B  it states a logical fact around wages which is also mentioned in the passage. Let me know if you have any confusion

Give Kudos if you like my reply

ravstime · Answer

B is the direct answer.
Any specific doubts?

prep · Answer

Yes, was debating between B and C.
In C, If Jones Industries has taken away twenty percent of Shelby Industries' business... that would mean lowering the wages would not help them having a competitive advantage, since they have anyways lost business.

Option B has no evidence/relation from the paragraph that lowering wages would reduce the quality of work. It could be other reasons, perhaps some employees aren't motivated by money.

Am I missing something?

prep · Answer

" I try to look around for the words which have already been mentioned in the passage"

Need more clarification on this. Many times correct answers have "new information". Moreover, wrong answers have words from the stimulus.
Or do you employ some other method?

crackHSW · Answer

Look at the conclusion , which says :

to promote this end, Shelby Industries should lower employee wages.  , if lowering wages has some other drawback , which in our case is the lowered sales then how will Shelby Ind have the advantage

Hope this helps

sanki779 · Answer

My fiend...Lowering wages will not help Shelby to to increase the sales.. that's the reason it is weaking the answer. Please read the problem statement again

12bhang · Answer

Shelby Industries manufactures and sells the same gauges as Jones Industries. Employee wages account for forty percent of the cost of manufacturing gauges at both Shelby Industries and Jones Industries. Shelby Industries is seeking a competitive advantage over Jones Industries. Therefore, to promote this end, Shelby Industries should lower employee wages.

Which of the following, if true, would most weaken the argument above?

Which of the following, if true, would most weaken the argument above?

(A) Because they make a small number of precision instruments, gauge manufacturers cannot receive volume discounts on raw materials. 
(B) Lowering wages would reduce the quality of employee work, and this reduced quality would lead to lowered sales. 
(C) Jones Industries has taken away twenty percent of Shelby Industries' business over the last year. 
(D) Shelby Industries pays its employees, on average, ten percent more than does Jones Industries. 
(E) Many people who work for manufacturing plants live in areas in which the manufacturing plant they work for is the only industry.

The answer to this particular question is fairly simple. However, I wanted your help regarding some answer choices and the the roles that they could play.

A) Because they make a small number of precision instruments, gauge manufacturers cannot receive volume discounts on raw materials.

Choice A is telling us about the lack of an alternate way to reduce its costs in order to increase competitive advantage over Jones.Does this actually strengthen the argument? By pointing out the lack of another means to improve its advantage , does it strengthen our belief that reducing employee salaries will have the intended effect.

If you remember the mall owners question that i asked you -  They "must " do something to achieve something . There the presence of an alternate method was serving as a weakener. In this case, will the lack of one of the hundred possible methods to achieve competitive advantage serve as a strenghtener? The verbiage of the conclusion is also not as strong as in the other question. it is only saying that the company should do something. Not that it has to or that it must.

Choice D: Shelby industries pays on an average its employees 10% more than does Jones Industries .
Does this also serve as a strenghtener ? I think not. Because , if Shelby pays its employees 10% higher than does Jones, it does not give us any reason to believe that the plan will be successful.

pqhai · Answer

Hi 12bhang

I think I could help you a bit.

For every CR questions, understand the conclusion correctly is KEY. 
The conclusion here is:  Shelby Industries will have a competitive advantage over Jones Industries (by reducing employee salaries) . Key word is "competitive advantage". So  competitive advantage will lead to what? Clearly, increase sale volume.  NOT lower sales prices . If Shelby reduces employee salaries, its sale price will be lower for sure. But that does not make sense, if sale volume does not increase.

Now let examine A and D.

(A) Because they make a small number of precision instruments, gauge manufacturers cannot receive volume discounts on raw materials. 
As you know, total manufacturing cost = raw material cost + other costs + labor costs. If raw material cost stays the same, labor cost will be reduced ==> sale price reduces. Yes, It's true. Does it strengthen the conclusion - "have a competitive advantage"?  If you think competitive advantage = lower sale price ==> A is a strengthener. BUT that's not what Shelby wants  (or the intended meaning of the conclusion). All Shelby wants is to increase its sale volume. Hence, A is not strengthener because it does not give you any idea that Shelby can improve its sales.

D) Shelby Industries pays its employees, on average, ten percent more than does Jones Industries.
Does it strengthen a conclusion? No. I would say D is not a strengthener, cause it helps nothing to buttress the conclusion (Shelby will have a "competitive advantage").
Let see an example: Shelby uses almost machine to manufacture gauges, so it uses fewer employees. But its employees are those who have high skills to manage automated machine. ==> Shelby must pay higher salaries, but labor is still 40%. If Shelby reduces its employees salaries, its employees will quit job ==> Shelby does not have "competitive advantage".

In short, In order to say an option is weakener / strengthener, you should  understand the conclusion (also the intended meaning) correctly . Do fall in trap just because apply theories too mechanically.

Hope it helps.

egmat · Answer

Let me add my bit to it. Your understanding is correct: "should" is not as strong as "must". If I say that to score above 700, you should practice for more than 10 hours a day - here, I am recommending a way to score 700 - even though I am not saying for sure that without 10 hours a day, you will not score above 700 but I am hinting towards it. However, if I say that to score above 700, you must study 10 hours a day - in this case, I am saying that if you don't study for 10 hours a day, you will not score 700. Now, coming back to option A. It can be thought of as strengthener in a way that it eliminates one of the ways to achieve competitive advantage. However, this is too mild a strengthener and per GMAT standards, it cannot be the correct choice in strengthen questions. I agree with you that that this is not a strengthener per GMAT standards. Hope this helps

Thanks, Chiranjeev

Senthil1981 · Answer

(B) Lowering wages would reduce the quality of employee work, and this reduced quality would lead to lowered sales.

When this is true, it would weaken the argument about reducing wages to save money.

Skywalker18 · Answer

Type - weaken
Boil it down - For a competitive advantage Shelby Industries should lower employee wages
Pre-thinking - Lower employee wages will have an adverse effect on sales 
Answer B

KanishkM · Answer

Can someone please let me know if my reasoning is correct

Conclusion -> Shelby Industries should lower employee wages, to achieve a competitive advantage
Weaken -> To achieve a competitive advantage,Shelby industries should not lower employee wages( They should do something else)

(C) Jones Industries has taken away twenty percent of Shelby Industries' business over the last year. 
This is giving a reason for the current market -  Neutral  statement

(D) Shelby Industries pays its employees, on average, ten percent more than does Jones Industries.
This is just stating about the current pay scale of Shelby -  Irrelevant

(E) Many people who work for manufacturing plants live in areas in which the manufacturing plant they work for is the only industry.
This is a  neutral  statement

Bottom 2
(A) Because they make a small number of precision instruments, gauge manufacturers cannot receive volume discounts on raw materials. 
This is just giving another reason why they should lower the prices, talking about gauge manufactures(this option is irrelevant)

(B) Lowering wages would reduce the quality of employee work, and this reduced quality would lead to lowered sales.
Reduced quality is the reason for lower sales, so they should not lower the wages

Correct Answer B

KanishkM · Answer

Can someone( gmat1393 , @nightblade354) please review my attempt,

Is my explanation in line with the original explanation.

Thank you for looking into my attempt.

Thought of tagging the Experts directly.

gmat1393 · Answer

KanishkM

Your reasoning looks legit to me

Thanks!

LordStark · Answer

Conclusion: Shelby Industries should lower employee wages
Type: Weakner
We need to find information that would make the plan of reducing employees makes the goal " Shelby Industries is seeking a competitive advantage over Jones Industries" less likely to be achievable.

(A) Because they make a small number of precision instruments, gauge manufacturers cannot receive volume discounts on raw materials.   irrelevant: No mention of anything related to reduction of wages  
(B) Lowering wages would reduce the quality of employee work, and this reduced quality would lead to lowered sales.   Correct: One possible bad effect of lowering wages  
(C) Jones Industries has taken away twenty percent of Shelby Industries' business over the last year.    Irrelevant  
(D) Shelby Industries pays its employees, on average, ten percent more than does Jones Industries.    irrelevant  
(E) Many people who work for manufacturing plants live in areas in which the manufacturing plant they work for is the only industry.    irrelevant

jaisonsunny77 · Answer

Type: Weaken the conclusion

Conclusion: to attain competitive advantage, Shelby Industries should lower employee wages
  
(A) Because they make a small number of precision instruments, gauge manufacturers cannot receive volume discounts on raw materials . -  Irrelevant to the conclusion drawn.

(B) Lowering wages would reduce the quality of employee work, and this reduced quality would lead to lowered sales. - (B) introduces an undesirable consequence should Shelby industries go ahead with it's plan to lower wages. For any firm, to attain a competitive advantage to attain a large customer base and hence large volumes of sales. So, if Shelby Industries suffer from lower sales, it would imply that the firm will loose its competitive edge. (B) therefore would weaken the conclusion cited. Hence,  (B) is the right answer choice. 
  
(C) Jones Industries has taken away twenty percent of Shelby Industries' business over the last year.  -  This simply emphasizes the Shelby Industries' desire to attain competitive advantage as soon as possible; (C) does not weaken the conclusion in any way.  
 
(D) Shelby Industries pays its employees, on average, ten percent more than does Jones Industries.  -  assume that Jones industries currently pays $100, while Shelby industries pay $110. The only thing that's mentioned in the passage is that Shelby Industries would like to ''lower'' its wages. The passage  does not indicate by how much  Shelby Industries would lower the wages. it could be true that Shelby Industries would lower the wages to $105 but still have a better wage (and therefore a competitive advantage). However, it could also be true that Shelby Industries intends to lower the wages to $90 and thereby lose its competitive advantage.

Since (D) does not tell us by how much Shelby Industries plan to lower the wages or mention the exact wages offered by both industries, we cannot use (D) to weaken the conclusion.  
 
(E) Many people who work for manufacturing plants live in areas in which the manufacturing plant they work for is the only industry.  -  irrelevant to the conclusion cited.

mba757 · Answer

B; P; P; C: to promote this end  , Shelby should lower employee wages. Hm...this sounds kind of fishy. Employees are an important element. If they reduce wages, what if people are less incentivized to work hard? What if people leave because of lower wages?

Which of the following, if true, would most weaken the argument above?
 
 A. Because they make a small number of precision instruments, gauge manufacturers cannot receive volume discounts on raw materials.
 Out of scope. We’re focused on the wages here and how it’s going to impact a potential competitive advantage over Jones.

B. Lowering wages would reduce the quality of employee work, and this reduced quality would lead to lowered sales.
 Bingo. Doesn’t actually produce desired result. Would weaken or lose a competitive advantage it sounds like.

C. Jones Industries has taken away twenty percent of Shelby Industries' business over the last year.
 Doesn’t matter. Given the passage, and keeping all things constant, wouldn’t lowering wages (i.e., a huge cost) help Shelby out? To offset this twenty percent lost business?

D. Shelby Industries pays its employees, on average, ten percent more than does Jones Industries.
 Strengthener, if anything. If this were true, it could make a competitive advantage to be potentially be more competitive with Jones by lowering its costs. A bit left field, but definitely not a weakener. D is out for sure.

E. Many people who work for manufacturing plants live in areas in which the manufacturing plant they work for is the only industry. 
Out of scope. Where people work doesn’t matter here. We want to know how Shelby > Jones.

gmatter923 · Answer

Shelby Industries manufactures and sells the same gauges as Jones Industries. Employee wages account for forty percent of the cost of manufacturing gauges at both Shelby Industries and Jones Industries. Shelby Industries is seeking a competitive advantage over Jones Industries. Therefore, to promote this end, Shelby Industries should lower employee wages.
Situation: S & J makes same product. Both have same 40% employee wages proportion of the total cost. Now, S wants a competitive advantage over J. So, they should lower employee wages.

Main Point: By lowering employee wages, S will gain competitive advantage over J.

Gaps: by lowering employee wages, company could make higher profits, by how would it help S to gain competitive advantage over J?
 
Which of the following, if true, would most weaken the argument above?

Type: Weaken

What to look for: we’re looking for an option, by which our confidence in the conclusion will go down.

(A) Because they make a small number of precision instruments, gauge manufacturers cannot receive volume discounts on raw materials.

Reject
Irrelevant to the passage. We’re not looking why S & J have higher production costs. 
 
(B) Lowering wages would reduce the quality of employee work, and this reduced quality would lead to lowered sales.

Accept
Yes, if this happens, the plan or conclusion that S will gain an advantage over J, weakens.
 
(C) Jones Industries has taken away twenty percent of Shelby Industries' business over the last year.

Reject
This gives us the reason why S wants to catch up, but doesn’t tell us anything about the validity of their plan.
 
(D) Shelby Industries pays its employees, on average, ten percent more than does Jones Industries.

Reject
At most this option strenghtn.
 
(E) Many people who work for manufacturing plants live in areas in which the manufacturing plant they work for is the only industry.

Reject
Irrelevant to the passage.

A_Nishith · Answer

Type - weaken
Boil it down - For a competitive advantage Shelby Industries should lower employee wages
Pre-thinking - Lower employee wages will have an adverse effect on sales

(A) Because they make a small number of precision instruments, gauge manufacturers cannot receive volume discounts on raw materials.

Reject
Irrelevant to the passage. We’re not looking why S & J have higher production costs.

(B) Lowering wages would reduce the quality of employee work, and this reduced quality would lead to lowered sales.

Accept
Yes, if this happens, the plan or conclusion that S will gain an advantage over J, weakens.

(C) Jones Industries has taken away twenty percent of Shelby Industries' business over the last year.

Reject
This gives us the reason why S wants to catch up, but doesn’t tell us anything about the validity of their plan.

(D) Shelby Industries pays its employees, on average, ten percent more than does Jones Industries.

Reject
At most this option strenghtn.

(E) Many people who work for manufacturing plants live in areas in which the manufacturing plant they work for is the only industry.

Reject
Irrelevant to the passage.

Answer: B

Shelby Industries manufactures and sells the same gauges as Jones Indu

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GMAT Critical Reasoning (CR) Questions

Shelby Industries manufactures and sells the same gauges as Jones Indu

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