Kingsland companies often outsource data-entry tasks to

Question

Kingsland companies often outsource data-entry tasks to foreign firms. The results of this outsourcing
have been shown to lower costs for Kingsland companies in several different ways, and high costs can
potentially bankrupt Kingsland companies. The decision to outsource is rare, except during recessions,
when the Kingsland economy is weak. Therefore, Kingsland companies probably outsource their work
because doing so helps them avoid bankruptcy.

Which of the following would it be most useful to determine in order to evaluate the argument?

(A) Whether outsourcing is the most effective cost-lowering method available to Kingsland firms.

(B) Whether the firms to which Kingsland companies outsource data-entry tasks are at risk of bankruptcy during recessions

(C) Whether companies in cities other than Kingsland outsource data-entry tasks to foreign firms

(D) Whether the only time foreign firms are available for data-entry tasks is when the Kingsland economy is weak

(E) Whether domestic firms are able to handle the data-entry tasks outsourced to foreign firms

Source: GMAT Hacks - 082013

The argument suggests that Kingsland companies outsource to foreign firms as a cost-saving measure, and that the cost savings are only worthwhile to them during recessions. One assumption the argument makes is that the same options are available to them at all times--the same mix of foreign and domestic options for outsourcing, or perhaps the same availability and cost of hiring employees. While this isn't explicitly an "assumption" question, many "evalulate" questions hinge on assumptions.

The assumption that the same options are available at all times is captured by (D), which is correct. It might seem obvious that, in most real-world situations, foreign firms are available at all times, but once the question raises it as a point that might be in question, you must consider the possibility that it is an assumption left unstated by the argument.

lvtrung205 · Answer

thanks for your post. I narrowed bew A and D, can you explain why A wrong?
thanks so much.

cameronsheng · Answer

I think the essence of this question is to determine whether the purpose of outsource is to avoid bankrupt in the recession or not. It has shown that outsource can reduce cost, but cost reduction does not directly lead to avoid bankrupt
(A) Whether outsourcing is the most effective cost-lowering method available to Kingsland firms.
This can determine whether the purpose of outsource is to achieve lowest cost, but cannot determine whether the outsource is to avoid bankruptcy 
(B) Whether the firms to which Kingsland companies outsource data-entry tasks are at risk of bankruptcy during recessions
Not related
(C) Whether companies in cities other than Kingsland outsource data-entry tasks to foreign firms
Not related
(D) Whether the only time foreign firms are available for data-entry tasks is when the Kingsland economy is weak
Correct, since if yes, then it is possible that the company made the decision to outsource in the recession only because this is the only time the option is available,
not because they want to avoid bankruptcy during recession.
(E) Whether domestic firms are able to handle the data-entry tasks outsourced to foreign firms
Not related

sidhu09 · Answer

I am not convinced that A is wrong and D is correct.
Need expert's help please

Archit143 · Answer

Paradox here is Outsourcing in recession is not a good idea but Kingsland firm did it because it is helping it to save itself from bankruptcy...........
I think B could be the best answer. May be this time recession has affected company doing outsourcing business also and they have reduced their charges hence is helping kingsland 
but cant think of answer why is D correct

Aristocrat · Answer

maybe outsourced company is at risk but they can be putting too much of effort in recession time.
and can provide best service available.

GmatCrackd31 · Answer

I found it quite ok...got it right answer....

bruinbear714 · Answer

The argument is that Kingsland companies PROBABLY outsources because doing so will help them avoid bankruptcy.

We're looking for an answer that would change the LIKELIHOOD of companies outsourcing during a recession to avoid bankruptcy, given the facts and statements made.

A) Whether outsourcing is the most effective cost-lowering method available to Kingsland firms.

This is too generalized. If outsourcing is the MOST effective way of lowering cost, then it companies will PROBABLY outsource. If it is NOT the most effective way, companies can still have the likelihood of outsourcing AND implement the most effective way (say for example, salary cut). We don't know whether the companies will implement either, both, or none. The answer to A) may affect the likelihood of outsourcing but is not guaranteed.

B) Whether the firms to which Kingsland companies outsource data-entry tasks are at risk of bankruptcy during recessions

The answer to B) might also affect the likelihood of outsourcing, but is also not guaranteed.

C) is irrelevant

D) Whether the only time foreign firms are available for data-entry tasks is when the Kingsland economy is weak

If outsourcing is not available when the economy is weak, then companies CANNOT outsource even if they wanted to. Info from answer D provides a more concrete resolution than answer B and A and guarantees that companies WILL NOT and CANNOT outsource if foreign firms are not available to take on the job.

E) is irrelevant

Marcab · Answer

B cannot be the answer. We don't care whether the foreign firms are in recession or out of recession. Even if they are, let them be. Who cares.
Whereas in D, if you answer the question in affirmative then the conclusion sounds fine but if your answer is NO then the conclusion doesn't sounds fine.
Straight shot D.

nevinlee · Answer

I would support the first option, as is the case in most of the outsourcing works.

___________________________
 employee benefits outsourcing

bugzor · Answer

I knew it was D but then I second guessed myself and picked A. I need to stop doing that.

jgomey · Answer

I fell for the trap in answer choice B. My reasoning was that the company may go out of business due to high cost if no foreign firm where available for outsourcing services, a circumstance that could result if the foreign firm went out of business during a recession.

My justification for D

"D" is the correct choice because the firm requiring outsourcing services needs those services most when cost are high. So will those services be available regardless of what is happening in the economy? If yes, then outsourcing makes sense, if not, it doesn't-the firm would not have the benefit of outsourcing when it needs outsourcing the most.

jgomey · Answer

I agree. The key, IMO, to eliminating B is that we would have to draw a second assumption to demonstrate why the firm seeking outsourcing service would be hurt. We would need to assume that the firm providing the outsourcing service could no longer do so, despite going through bankruptcy, and that no other firm would be available to provide the service. What are your thoughts?

avohden · Answer

Kingsland companies often outsource data-entry tasks to foreign firms. The results of this outsourcing 
have been shown to lower costs for Kingsland companies in several different ways, and high costs can
potentially bankrupt Kingsland companies. The decision to outsource is rare, except during recessions, 
when the Kingsland economy is weak. Therefore, Kingsland companies probably outsource their work 
because doing so helps them avoid bankruptcy. 
 
Which of the following would it be most useful to determine in order to evaluate the argument?

(A) Whether outsourcing is the most effective cost-lowering method available to Kingsland firms.

(B) Whether the firms to which Kingsland companies outsource data-entry tasks are at risk of bankruptcy during recessions

(C) Whether companies in cities other than Kingsland outsource data-entry tasks to foreign firms

(D) Whether the only time foreign firms are available for data-entry tasks is when the Kingsland economy is weak

(E) Whether domestic firms are able to handle the data-entry tasks outsourced to foreign firms

Source:   GMAT Hacks - 082013

avohden · Answer

Official Explanation

Answer: D  The argument suggests that Kingsland companies outsource to foreign firms as a cost-saving measure, and that the cost savings are only worthwhile to them during recessions. One assumption the argument makes is that the same options are available to them at all times--the same mix of foreign and domestic options for outsourcing, or perhaps the same availability and cost of hiring employees. While this isn't explicitly an "assumption" question, many "evalulate" questions hinge on assumptions. The assumption that the same options are available at all times is captured by  (D), which is correct.  It might seem obvious that, in most real-world situations, foreign firms are available at all times, but once the question raises it as a point that might be in question, you must consider the possibility that it is an assumption left unstated by the argument.

avohden · Answer

IMO – the question disguises the conclusion and confuses a premise of the argument as a faux conclusion.

Companies outsource certain tasks to save money. High costs could bankrupt companies

Companies outsource to avoid bankruptcy – The sentence includes the key conclusion word “Therefore”, then uses the word “probably”. Probably implies more of a supportive claim to the conclusion than a conclusion.

Conclusion   Companies only seem to outsource when the economy is weak.   The assumption inherent in the conclusion is that the only time to outsource is when the economy is weak. The conclusion makes a huge jump in logic to get to this conclusion from the premise statements. Why do companies only make outsourcing decisions when the economy is weak? What about when the economy is good? Wouldn't it make sense to take preemptive action before the economy gets weak? Is the option to outsource before the economy gets weak even available? These types of questions help poke holes in the conclusion/assumption link.

KanupriyaS – (A) seems to be “out of scope” since the passage is more concerned with outsourcing to save money and not the different types of money saving opportunities. When you identify the conclusion in the passage, it makes it a lot easier to evaluate the answer choices. Unfortunately the conclusion was disguised and a premise statement was disguised as a conclusion with the word “therefore”.

Hope this helps.

Just wanted to let you know that i got this question wrong too.

KanupriyaS · Answer

thanks avohden. your explanation helped

mohnish104 · Answer

I tried using the Yes or No method. Couldn't figure out the right answer using that method.

pramendrapandeya · Answer

Simply i voted for D; You can outsource only when they are ready to take assignment i.e availability

Konstantin1983 · Answer

I don't like this question. Why B is not correct? May be Kingsland companies outsource service to save other firms from bankrupcy and this is what B states

Kingsland companies often outsource data-entry tasks to

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Kingsland companies often outsource data-entry tasks to

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