A company that manufactures plastic products from recyclable plastic

Question

A company that manufactures plastic products from recyclable plastic is, surprisingly, unconcerned that economic conditions may worsen, despite analysts’ belief that consumers would then consider eco friendly plastic products an expensive luxury.

i m very confused about the adverb "surprisingly"? why is it so surprising? if the economic conditions may worsen, they should be happy? because their plastic product are so cheap as compared to eco friendly plastic product

Demand among manufacturers for recyclable plastics as raw materials would then plummet

if the condition worsen and if ecofriendly plastic products are considered as luxury, why would demand for recyclable plastics plummet? if the product is so cheap shouldn't it be the otherway round? (i.e. ecofriendly prodct demand would drop because it is expensive; whereas the demand for recyclable plastics would increase because not everyone can afford eco-friendly plastic product anymore)

Which of the following, if true, most weakens the company's reasoning?

A. Smaller ecofriendly plastic manufacturers are more likely to fail in a weakened economy than larger ecofriendly manufacturers are.
B. Some retailers whose sales include various companies' ecofriendly plastic products have struggled in recent years despite the overall good economy.
C. Consumers would likely soon learn of the oversupply of recyclable plastics and cease recycling them, significantly raising manufacturers' raw-material costs.
D. Retailers, including retailers that cater to consumers seeking certain types of ecofriendly products, may lose some business if economic conditions worsen.
E. The plastics used by the company in its products were, after a recent investigation by a regulatory body, declared to be safe for consumers.

CR40751.01
OG2020 NEW QUESTION

DavidTutorexamPAL · Accepted Answer

Hey  samguru68 ,

You're absolutely right that getting lost in wordy statements wastes WAY too much time. This is especially relevant to CR, but also to RC and to long word problems in Quant.
We suggest two main approaches to getting over this hurdle:
Step 1:
Break down the long wordiness into 'short logical chunks'. In RC this is basically the notes you take to summarize the passage, in Quant this would be translating the long, wordy, problem into small, clear, equations, and in CR it is a mix of the two: try translating the passage into a 'bulletpoint logical summary', i.e. writing separate pieces of logic in separate bullets (see below). This will make it much easier for you to reason about the passage.
In our case, we could break the passage down into:
1. company is not worried about bad economy
2. (because) in weak economy competitors will fail and
3. (therefore) there would oversupply of raw materials and
4. (therefore) raw materials would become less expensive.
5. (then) company could lower prices
Once you have a 'logical summary' such as the above in front of you, it is much (much) easier to reason about the passage.
Now, I'm not suggesting you make this summary for every CR question on the exam, but I am suggesting you practice with it. Over time, you won't actually have to write all of this out, but can rather 'mentally summarize it' similarly to what I did in the answer above.

Step 2:
Once you've done the work of breaking down the passage, analyze your breakdown. What is the weakest/strongest link? Which pieces of logic connect each of the statements? How could you attack them? GMAT CR answers are usually relatively straightforward -- once you've correctly understood the logic of the passage, you will easily be able to identify the logical links the question is pointing you towards. Then, all you have to do is look for the answer choice that addresses these links in the most direct way possible. In our case, the argument contains numerous steps so it is hard to guess which link will be addressed by the answer choices, but having the summary right there in front of you does serve as an anchor: when looking over the answer choice options, you can just ask 'does this option refer back to one of the logical links?'. If the answer is 'no', then the option is irrelevant (this happens for (B), (D), (E) in the above question). Only if the answer is 'yes' do you have to think about the option a bit more.
Step 2 is a big time-saver, as it prevents you from having to think through every single one of the available answer choices (whether you could infer a likely answer or not).

Together, the two steps will save you a lot of time once you get used to doing them. (It can take a while, but is certainly worth it!)

Best of luck!
(If you want to see more, check out our CR videos in our course)

DavidTutorexamPAL · Answer

The company's reasoning is that if conditions worsen, competitors would fail so demand for reusable materials would decrease and the company would pay less for them. This would then allow it to lower prices. As this reasoning has numerous logical steps, there are many ways to attack it and we'll go directly to the answer choices instead of inferring a likely answer. This is the Alternative approach.

A. Assuming this company is large, than this statement is a strengthener as it supports the company's logic. No.
B. this does not address the company's logic at all. No
C. this directly attacks the 'manufacturers would lower prices' and is a good choice. Let's keep going
D. Retailers are not part of the company's logic. No
E. this does not address the company's logic at all. No

(C) is our answer.

samguru68 · Answer

Please help me with the question above. I get lost in the wordy statements above and in exam we will not have much time for that

Posted from my mobile device

Tracy95 · Answer

Initially I chose B, reasoning that sales of ecofriendly plastic products recorded by retailers is not good even in good economy, let alone in bad economy. But then I looked into the wording of option B more closely, "Some retailers whose sales include various companies' ecofriendly plastic products", realizing that "whose sales" as a whole that struggled doesn't necessarily mean sales of ecofriendly plastic products struggles, and that the case applied to various companies isn't necessarily applied to the company being mentioned. So eliminate B.

Option C definitely attacks the company's reasoning in a more direct way.

Option C definitely attacks the company's reasoning in a more direct way.

HarshaGM · Answer

The correct answer is option (C).

My reasoning for the same is as follows.

Company's logic:

(As the economy weakens) -> (other plastic manufacturers i.e. the company's competitors will fail) -> (This will reduce the demand for recyclable plastics (the raw material used by the company)) -> (this would create an over-supply of recyclable plastics) -> (Due to low demand and high supply of recyclable plastics, their price would fall) -> (this means that the company can buy it cheaper, and reduce their cost of raw materials) -> (as a result, the company would be able to lower it's price to the final consumer).

What will effectively weaken the company's argument?
1. Any detail that indicates that other companies will not fail as intended due to weak economy.
2. Any detail that indicates that despite the reduced demand, recyclable plastics may not be over-supplied (What if the supply reduces correspondingly due to some reason?)
3. Any detail that indicates that despite low demand and high supply, price of recyclable plastics wont come down (say, because of government regulations)
4. Any detail that indicates that the company will not be able to reduce its price despite a reduction in their cost of making plastics (for some reason)

Now, let us check the options.

A. Smaller ecofriendly plastic manufacturers are more likely to fail in a weakened economy than larger ecofriendly manufacturers are.

We do not know if the other companies talked about in the passage are small companies. Even if that is so, and out company is a big one, this statement is at best a strengthener. No.

B. Some retailers whose sales include various companies' ecofriendly plastic products have struggled in recent years despite the overall good economy.

This does not have any bearing on the logic used by the company. At best, it tells us that even in a good time, ecofriendly plastics are hard to sell, hence a price reduction can help. But it does not impact the core logic. Not a weakener. 
 
C. Consumers would likely soon learn of the oversupply of recyclable plastics and cease recycling them, significantly raising manufacturers' raw-material costs.

How are plastics recycled? Consumers (you or me) of plastic hand over used plastic for recyclying. This plastic goes to companies that recycle the used plastic. Then, companies like the one in the passage use this recycled plastic to make plastic products.

Now, what if consumers learn about over-availability of recyclable plastics, and for some reason stop recycling? Then, the supply of recycled plastic will come down, which will increase the cost at which our company can buy the available recycled plastic. As a result, the company will definitely not be able to lower its price (given its cost has increased instead of decreasing). Hence, this option will definitely weaken the conclusion.

This option is in line with our weakener #2.

D. Retailers, including retailers that cater to consumers seeking certain types of ecofriendly products, may lose some business if economic conditions worsen.

Irrelevant. This has nothing to do with the logic of the company's argument and in no way weakens it.

E. The plastics used by the company in its products were, after a recent investigation by a regulatory body, declared to be safe for consumers.

Irrelevant. This has nothing to do with the logic of the company's argument and in no way weakens it.

Cheers!

IloveMBA123 · Answer

A company that manufactures plastic products from recyclable plastic is, surprisingly, unconcerned that economic conditions may worsen, despite analysts’ belief that consumers would then consider eco friendly plastic products an expensive luxury.

i m very confused about the adverb "surprisingly"? why is it so surprising? if the economic conditions may worsen, they should be happy? because their plastic product are so cheap as compared to eco friendly plastic product

Demand among manufacturers for recyclable plastics as raw materials would then plummet

if the condition worsen and if ecofriendly plastic products are considered as luxury, why would demand for recyclable plastics plummet? if the product is so cheap shouldn't it be the otherway round? (i.e. ecofriendly prodct demand would drop because it is expensive; whereas the demand for recyclable plastics would increase because not everyone can afford eco-friendly plastic product anymore)

jaisonsunny77 · Answer

A. Smaller ecofriendly plastic manufacturers are more likely to fail in a weakened economy than larger ecofriendly manufacturers are.  -  small v/s large manufacturer distinction does not related to the ''reduction of costs'' hypothesis presented by the company.   
B. Some retailers whose sales include various companies' ecofriendly plastic products have struggled in recent years despite the overall good economy . -  we do not know if the retailers chosen by the company are included in these retailers who have struggled in recent years.  
 C. Consumers would likely soon learn of the oversupply of recyclable plastics and cease recycling them, significantly raising manufacturers' raw-material costs. - if this is true, then the supply of raw materials diminishes. If less raw material is available, then the procurement costs for these limited supply raw materials would rise, thereby raising the manufacturing costs - this directly weakens the reasoning of the argument. Hence,  (C) is the right answer choice . 
  
D. Retailers, including retailers that cater to consumers seeking certain types of ecofriendly products, may lose some business if economic conditions worsen.  -  we do not know whether the particular company (mentioned in the passage) has any such retail partners who has lost some business. 
  
E. The plastics used by the company in its products were, after a recent investigation by a regulatory body, declared to be safe for consumers. -  irrelevant .

GMATNinja · Answer

It looks like your confusion comes from thinking the company's plastic products are different from eco-friendly plastic products. While the passage doesn't explicitly say this, the company's plastic products  are  eco-friendly plastic products. The reason we know that the company's products are eco-friendly is that they  use  recycled plastic to make their products.

If the company's product were not eco-friendly plastic products, the analysts' beliefs  "that consumers would then consider ecofriendly plastic products an expensive luxury"  would not apply to this company and the company's belief might not be surprising. Since the company does make eco-friendly plastic products, however, the analysts' beliefs do apply to this company.

If consumers view eco-friendly plastic products as an expensive luxury, then they are less likely to buy them in an economic downturn. This would decrease the company's revenue and it could begin to struggle. This makes its lack of concern surprising.

Also, we have no information about the cost of the company's products -- all we know is that the company predicts it will be able to lower its costs.

Knowing that the company's products are eco-friendly plastic products should also help answer your second question, too. It is not general demand for recyclable plastics that would plummet, it is demand  "among manufacturers."

The previous sentence tells us that  "in a weakened economy, other ecofriendly plastic manufacturers are likely to fail."  This means there would be fewer companies purchasing recyclable plastics to make into eco-friendly plastic products. This means the company would have less competition for its resources and would be able to pay less for the plastic it needs to manufacture its products, lowering its costs.

I hope that helps!

egmat · Answer

Let us help you with this question.

Understanding the Passage

A company that makes plastic products from recyclable plastic is not worried about the economic condition possibly deteriorating.

This is despite the fact that analysts believe that consumers would consider eco-friendly plastic products as an expensive luxury.

The company says that they are not worried because they believe they can lower the prices.

How will they do that?

The company believes that in a weakened economy, other eco-friendly plastic manufacturers would fail in running their business.

As a result, demand among manufacturers for recyclable plastic will go down. That means there will be an oversupply of raw materials. When the demand falls, so does the price, so  price for raw materials would reduce. . Thus, the company would acquire the raw materials at lower costs and will be able to reduce the prices of ec-friendly plastic products.

Pre-thinking

What if due to some factor, the prices of raw material do now reduce or the prices of raw materials stay the same, then the company's plan to achieve lower prices will fail as it is completely based on the reasoning that the company will be able to get raw materials at lower costs.

Option C

This option tells us that the prices of raw material would increase due to X reason. Now, this directly attacks the company's reasoning and therefore, is a weakener.

Hope this helps

Thanks

celan99 · Answer

A company that manufactures plastic products from recyclable plastic is, surprisingly, unconcerned that economic conditions may worsen, despite analysts’ belief that consumers would then consider eco friendly plastic products an expensive luxury.

i m very confused about the adverb "surprisingly"? why is it so surprising? if the economic conditions may worsen, they should be happy? because their plastic product are so cheap as compared to eco friendly plastic product

Demand among manufacturers for recyclable plastics as raw materials would then plummet

if the condition worsen and if ecofriendly plastic products are considered as luxury, why would demand for recyclable plastics plummet? if the product is so cheap shouldn't it be the otherway round? (i.e. ecofriendly prodct demand would drop because it is expensive; whereas the demand for recyclable plastics would increase because not everyone can afford eco-friendly plastic product anymore)

Which of the following, if true, most weakens the company's reasoning?

Companies reasoning : companies fail -> demand plummet -> manufacturing cost decreases

Possible weakening ?
Maybe demand might not plummet for some reason.
Maybe suppliers start to control the supply, making the cost of the market steady.

A. Smaller ecofriendly plastic manufacturers are more likely to fail in a weakened economy than larger ecofriendly manufacturers are.
-> OOS, which type of companies are more likely to fail is not our concern.

B. Some retailers whose sales include various companies' ecofriendly plastic products have struggled in recent years despite the overall good economy.
-> OOS, terms regarding good economy is not our interest.

C. Consumers would likely soon learn of the oversupply of recyclable plastics and cease recycling them, significantly raising manufacturers' raw-material costs.
-> Correct, if for any reason the manufacturing costs has increased, then the corporations reasoning fails.

D. Retailers, including retailers that cater to consumers seeking certain types of ecofriendly products, may lose some business if economic conditions worsen.
-> OOS, retailers to end customer is not our concern.

E. The plastics used by the company in its products were, after a recent investigation by a regulatory body, declared to be safe for consumers.
-> OOS, safe or not is nor our concern.

ArnauG · Answer

The company manufacturing plastic products from recyclable plastic is unconcerned about worsening economic conditions because it believes it can lower its prices due to potential failures of other ecofriendly plastic manufacturers. This reasoning is based on the assumption that a weakened economy would lead to a decrease in demand for recyclable plastics, resulting in oversupply and lower costs. We are asked to find the statement that weakens the company's reasoning the most.

Option A suggests that smaller ecofriendly plastic manufacturers are more likely to fail in a weakened economy than larger manufacturers. This weakens the company's reasoning because if smaller manufacturers are more likely to fail, it may not lead to a significant decrease in supply or lower costs for the company.

Option B states that some retailers selling ecofriendly plastic products have struggled in recent years despite the overall good economy. This information does not directly impact the company's reasoning about lowering costs due to failures of other manufacturers.

Option C suggests that if consumers learn of the oversupply of recyclable plastics, they may stop recycling them, which would raise manufacturers' raw-material costs. This weakens the company's reasoning because it implies that the oversupply may not result in lower costs for the company if consumers' recycling habits change.

Option D mentions that retailers, including those catering to consumers seeking ecofriendly products, may lose some business in a worsening economy. While this information may have some impact on the market, it does not directly weaken the company's reasoning about lower costs due to failures of other manufacturers.

Option E states that the plastics used by the company have been declared safe for consumers. However, this information is unrelated to the company's reasoning about lower costs based on the failures of other manufacturers.

Among the options provided, option C weakens the company's reasoning the most. If consumers cease recycling recyclable plastics due to oversupply, it suggests that the company may not benefit from lower costs as anticipated. Therefore, option C undermines the company's reasoning by suggesting that the oversupply of recyclable plastics may not result in the cost reduction the company expects.

Sa800 · Answer

I just don’t get this….why would consumers want to stop recycling so that manufacturers costs increase which then causes the eco friendly plastic products costs to increase as well…?

Don’t consumers want lower prices of eco friendly products so that they can buy it?

stackskillz · Answer

This is the quick solution I came up with:

Conc:  Other ecofriendly plastic manufacturers will fail => Company will be able to lower its prices.

A.  Smaller ecofriendly plastic manufacturers are more likely to fail in a weakened economy than larger ecofriendly manufacturers are.  - This actually strengthens the company's position by stating more information on types of companies that are more likely to fail.  Drop

B.  Some retailers whose sales include various companies' ecofriendly plastic products have struggled in recent years despite the overall good economy.  - The fact that some retailers (with catalogue of eco-friendly plastics) struggeled doesn't cast valid doubt on the claim from the company. This might indicate an issue with those retailers rather than the product segment. Doesn't impact the conclusion.  Drop

C.  Consumers would likely soon learn of the oversupply of recyclable plastics and cease recycling them, significantly raising manufacturers' raw-material costs.  - This option offsets the lowering of price that company is counting, thereby weakening the conclusion.  Keep

D.  Retailers, including retailers that cater to consumers seeking certain types of ecofriendly products, may lose some business if economic conditions worsen.  - This options is predicting some of the effects of economic down-turn. However, whether the retailers lose business or not, doesn't seem to impact the conclusion of the company.  Drop

E.  The plastics used by the company in its products were, after a recent investigation by a regulatory body, declared to be safe for consumers.  - This option answers the question, "Are the products made by the company safe?". However, does the answer to the question tell us whether the company will survive an economic downturn. Not really.  Drop

GMATNinja · Answer

Good question. Perhaps consumers, who hear so much about the importance of recycling, also hear that their recycled plastics aren't being used. This might make them stop recycling . Consumers may also be unable to see the complex chain of events which you and I can -- they may not have access to a neat summary in the form of a GMAT CR question.

In addition, the question asks “Which of the following, if true , most weakens the company's reasoning?” So we don’t need to worry about whether the answer choice makes sense, only what would happen to the argument if that thing were true. I hope that helps!

MoPouyan · Answer

C directly undermines the company's assumption about costs. If consumers stop recycling because they learn about the oversupply, then the expected oversupply would disappear. Instead of having a surplus of recyclable plastic (which would lower costs), there could be a shortage, which would  increase  costs. This contradicts the company’s reasoning that costs will go down and weakens the argument effectively.

tommychudw · Answer

I get that option C is the best choice as it directly undermines the supply consideration presented in the company's reasoning.

However, it's just absurd to think that consumers will react from the awareness of oversupplied recyclable plastic by ceasing to recycle altogether..

VerbalBot · Answer

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A company that manufactures plastic products from recyclable plastic

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A company that manufactures plastic products from recyclable plastic

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