In their study of whether offering a guarantee of service quality will

Question

In their study of whether offering a guarantee of service quality will encourage customers to visit a particular restaurant, Tucci and Talaga have found that the effect of such guarantees is mixed. For higher-priced restaurants, there is some evidence that offering a guarantee increases the likelihood of customer selection, probably reflecting the greater financial commitment involved in choosing an expensive restaurant. For lower-priced restaurants, where one expects less assiduous service, Tucci and Talaga found that a guarantee could actually have a negative effect: a potential customer might think that a restaurant offering a guarantee is worried about its service. Moreover, since customers understand a restaurant’s product and know what to anticipate in terms of service, they are empowered to question its quality. This is not generally true in the case of skilled activities such as electrical work, where, consequently, a guarantee might have greater customer appeal.

For restaurants generally, the main benefit of a service guarantee probably lies not so much in customer appeal as in managing and motivating staff. Staff members would know what service standards are expected of them and also know that the success of the business relies on their adhering to those standards. Additionally, guarantees provide some basis for defining the skills needed for successful service in areas traditionally regarded as unskilled, such as waiting tables.

For restaurants generally, the main benefit of a service guarantee probably lies not so much in customer appeal as in managing and motivating staff. Staff members would know what service standards are expected of them and also know that the success of the business relies on their adhering to those standards. Additionally, guarantees provide some basis for defining the skills needed for successful service in areas traditionally regarded as unskilled, such as waiting tables.   1 
 1. The primary purpose of the passage is to

A. question the results of a study that examined the effect of service-quality guarantees in the restaurant industry
B. discuss potential advantages and disadvantages of service-quality guarantees in the restaurant industry
C. examine the conventional wisdom regarding the effect of service-quality guarantees in the restaurant industry
D. argue that only certain restaurants would benefit from the implementation of service-quality guarantees
E. consider the impact that service-quality guarantees can have on the service provided by a restaurant

2 
 2. It can be inferred that the author of the passage would agree with which of the following statements about the appeal of service guarantees to customers?

A. Such guarantees are likely to be somewhat more appealing to customers of restaurants than to customers of other businesses.
B. Such guarantees are likely to be more appealing to customers who know what to anticipate in terms of service.
C. Such guarantees are likely to have less appeal in situations where customers are knowledgeable about a business’s product or service.
D. In situations where a high level of financial commitment is involved, a service guarantee is not likely to be very appealing.
E. In situations where customers expect a high level of customer service, a service guarantee is likely to make customers think that a business is worried about its service.

3 
 3. According to the passage, Tucci and Talaga found that service guarantees, when offered by lower-priced restaurants, can have which of the following effects?

A. Customers’ developing unreasonably high expectations regarding service
B. Customers’ avoiding such restaurants because they fear that the service guarantee may not be fully honored
C. Customers’ interpreting the service guarantee as a sign that management is not confident about the quality of its service
D. A restaurant’s becoming concerned that its service will not be assiduous enough to satisfy customers
E. A restaurant’s becoming concerned that customers will be more emboldened to question the quality of the service they receive

thangvietname · Accepted Answer

the first question is hard. it takes me a long time to eliminate choice E. 
justify every word in answer choices

the word "service" makes choice E wrong.

impact of garantee on service is discussed on the last paragraph not for whole passage. the whole passage is about impact of guarantee on the restaurant industry. B is right.

mikemcgarry · Answer

Dear Kritesh , I'm happy to respond.

The phrase " conventional wisdom " is a common term, especially in business writing. Suppose that a particular industry has been stable for decades, and that the successful people in this industry have a shared understanding of what moves lead to success. This shared understanding, drawn from experience in a field, is called " conventional wisdom ." It's not always completely true and it's not necessarily the best possible way: often, an innovator in a field is someone who comes in, questions the conventional wisdom, and suggests something radically different that works. In this passage, " the conventional wisdom regarding the effect of service-quality guarantees in the restaurant industry " means the shared understanding, derived from experience, that people in the restaurant industry have after years of working with service-quality guarantees. In other words, all these people in restaurant industry who have thought about service-quality guarantees, who have offered them, and who have seen the results of them in their business--all these people have some shared understanding of what works and what doesn't work. That's conventional wisdom. My friend, if this phrase completely new to you, that tells me that you are not reading enough. If you want to succeed on the GMAT and in the global business world, you need to be reading business news regularly. See: How to Improve Your GMAT Verbal Score Does all this make sense? Mike

GMATNinja · Answer

Passage breakdown 
In the first paragraph (P1), the author  discusses the mixed impact of a certain business practice .

Does offering a guarantee of service quality encourage customers to visit a particular restaurant? 
 For higher-priced restaurants: yes 
 For lower-priced restaurants: not really

In the second paragraph, the author  provides an alternate reason for the business practice .

Service guarantees motivate staff

For more on the process of breaking down RC passages, check out  this article  and  our live RC videos .

Explanations for individual questions 
 
 Question 2
   Part 1  
  Part 2   
 
  Question 3

Shiv2016 · Answer

Passage analysis:

In their study of whether offering a guarantee of
service quality will encourage customers to visit a
particular restaurant, Tucci and Talaga have found
that the effect of such guarantees is mixed. For
(5)
higher-priced restaurants, there is some evidence
that offering a guarantee increases the likelihood of
customer selection, probably reflecting the greater
financial commitment involved in choosing an
expensive restaurant. For lower-priced restaurants,
(10)
where one expects less assiduous service, Tucci and
Talaga found that a guarantee could actually have a
negative effect: a potential customer might think that
a restaurant offering a guarantee is worried about
its service. Moreover, since customers understand a
(15)
restaurant’s product and know what to anticipate in
terms of service, they are empowered to question its
quality. This is not generally true in the case of skilled
activities such as electrical work, where, consequently,
 a guarantee might have greater customer appeal. 
(20)
For restaurants generally, the main benefit of
a service guarantee probably lies not so much in
customer appeal as in managing and motivating staff.
Staff members would know what service standards
are expected of them and also know that the success
(25)
of the business relies on their adhering to those
standards. Additionally, guarantees provide some
basis for defining the skills needed for successful
service in areas traditionally regarded as unskilled,
such as waiting tables.

Topic of the passage (i.e. what is the passage talking about?):  Guarantee of service quality
 Logic of the first para (i.e. what it really wants to convey):  Effect of guarantees (guarantee of
service quality will encourage customers to visit a
particular restaurant) is MIXED.

The first para further explains this "MIXED".

Second para: It kinds of contradicts what was stated in the  last line  of the first para.
It contradicts by saying that guarantee is beneficial in staff management.

Flow of the passage:

The passage starts off by mentioning about a study conducted by Tucci and Talaga. It says that guarantees have mixed effects (guarantees of service quality that will encourage customers to visit a particular RESTAURANT).

Then it goes on explaining this "MIXED". In the last line of the first para, it states that this is not true for skilled activities. This means that restaurant service is not a skilled activity. In skilled activities, a guarantee might have greater customer appeal.

In the second para, it contradicts the idea presented in last line of the first para.

"The main benefit of a service guarantee lies (probably) in staff management."

But the second para states benefits of guarantee in restaurant business.

Shiv2016 · Answer

The primary purpose of the passage is to
A.   question   the results of a study that examined the effect of service-quality guarantees in the restaurant industry
B.   discuss  potential advantages and disadvantages  of service-quality guarantees in the restaurant industry
C.  examine  the  conventional wisdom  regarding the effect of service-quality guarantees in the restaurant industry
D.  argue  that  only   certain restaurants  would benefit from the implementation of service-quality guarantees
E.  consider  the  impact  that service-quality guarantees can have on the service provided by a restaurant

(Book Question: 413)
It can be inferred that the author of the passage would agree with which of the following statements about the appeal of service guarantees to customers?
A. Such guarantees are likely to be somewhat more appealing to customers of restaurants than  to customers of other businesses. 
B. Such guarantees are likely to be more appealing to customers  who know  what to anticipate in terms of service.
C. Such guarantees are likely  to have less appeal in situations where customers are knowledgeable about a business’s product or service .
D. In situations where a  high level of financial commitment is involved, a service guarantee is not likely to be very appealing .
E. In situations where customers  expect a high level of customer service , a service guarantee is likely to make customers think that a business is worried about its service.

(Book Question: 414)
According to the passage, Tucci and Talaga found that service guarantees, when offered by lower-priced restaurants, can have which of the following effects?
A. Customers’ developing unreasonably high expectations regarding service
B. Customers’ avoiding such restaurants because they fear that the service guarantee may not be fully honored
C. Customers’ interpreting the service guarantee as a sign that management is not confident about the quality of its service
D. A restaurant’s becoming concerned that its service will not be assiduous enough to satisfy customers
E. A restaurant’s becoming concerned that customers will be more emboldened to question the quality of the service they receive

Kritesh · Answer

Time taken - 10 mins
Got all the questions right!!

Was lucky on the first one as i was stuck between option B and C and chose B.

GMATNinja   mikemcgarry  - Could you please explain option C which mentions that  examine the conventional wisdom regarding the effect of service-quality guarantees in the restaurant industry

I did not understand the  Conventional wisdom  part .

shra1raju · Answer

(Book Question: 413)
It can be inferred that the author of the passage would agree with which of the following statements about the appeal of service guarantees to customers?
 A. Such guarantees are likely to be somewhat more appealing to customers of restaurants than to customers of other businesses.
 B. Such guarantees are likely to be more appealing to customers who know what to anticipate in terms of service.
 C. Such guarantees are likely to have less appeal in situations where customers are knowledgeable about a business’s product or service.
 D. In situations where a high level of financial commitment is involved, a service guarantee is not likely to be very appealing.
----------
I have taken 2mins to read the passage and write the Point of the passage. and took
50Secs- 1st Q - Right
90Secs - 2nd Q- Wrong
30Secs - 3rd Q - Right

I find all the explanations help for Q1 & 3 but I felt Q2's explanations are missing. So, here are my two cents,

Q2 Explanation: Question Type: Inference question, so the option chosen have to be 100% true according to the passage information

A - Other businesses are not at all touched in the given passage. We are not sure about the outside info. - Eliminated
B - This option Contradicts the given information because the passage says that " Customer who have knowledge of the product and know what to expect out of the servie - WOULD QUESTION THE QUALITY"- Why do they question because Service Guarantee is not so appealing to the customer. - Eliminated
D - Passage doesn't count on the financial aspect of the restaurant business, so it is a weak statement one could make. - Eliminated

Devil Choice: C Vs E
Both these choices refer to this line in the passage "

"Moreover, since customers understand a restaurant’s product and know what to anticipate in terms of service, they are empowered to question its quality."

E - The second part of the choice is 100% true that "a service guarantee is likely to make customers think that a business is worried about its service", but where it commit suicide is the part clause attached to this answer choice "In situations where customers expect a high level of customer service", this clause is never mentioned or referred in the passage. - Eliminated

C - Yup, Service guarantee is not so appealing to a customer who has a knowledge of the service or the product.

I believe the method of POE is a very powerful technique to excel on GMAT. Hope the above explanation helps!!!!

hero_with_1000_faces · Answer

The primary purpose of the passage is to
A. question the results of a study that examined the effect of service-quality guarantees in the restaurant industry

The study is not being questioned, giving guaranteed quality service has been questioned and not the study itself

B. discuss potential advantages and disadvantages of service-quality guarantees in the restaurant industry

In all the lines the advantages and disadvantages has been discussed in the passage,
 
(Line 1 to 4) Talks about study, the outcome/effect of study being mixed (i.e having both pro's and con's)

(Line 5) Advantages; (line 10) disadvantage (line 15) customer mindset, pointing towards disadvantage, (Line 20 & 25) talks about advantages.

As per  egmat , a primary purpose passage should consider all the points in the passage.

C. examine the conventional wisdom regarding the effect of service-quality guarantees in the restaurant industry

Eliminate as this passage talks about a study done and not wisdom.

D. argue that only certain restaurants would benefit from the implementation of service-quality guarantees

Passage is not arguing for anything, it is stating the effects; the pro's and cons.

E. consider the impact that service-quality guarantees can have on the service provided by a restaurant

This is tricky, although the study does show the impact that service-quality guarantees can have on restro industry, the passage is written to show the mixed effect, that the advantages and disadvantages of doing so. and not merely preseting the effect.

In their study of whether offering a guarantee of service quality will encourage customers to visit a
particular restaurant, Tucci and Talaga have found that the effect of such guarantees is mixed. For
(5)
higher-priced restaurants, there is some evidence that offering a guarantee increases the likelihood of
customer selection, probably reflecting the greater financial commitment involved in choosing an
expensive restaurant. For lower-priced restaurants,

(10)
where one expects less assiduous service, Tucci and Talaga found that a guarantee could actually have a
negative effect: a potential customer might think that a restaurant offering a guarantee is worried about
its service. Moreover, since customers understand a

(15)
restaurant’s product and know what to anticipate in terms of service, they are empowered to question its
quality. This is not generally true in the case of skilled activities such as electrical work, where, consequently,
a guarantee might have greater customer appeal.

(20)
For restaurants generally, the main benefit of a service guarantee probably lies not so much in
customer appeal as in managing and motivating staff. Staff members would know what service standards
are expected of them and also know that the success

(25)
of the business relies on their adhering to those standards. Additionally, guarantees provide some
basis for defining the skills needed for successful service in areas traditionally regarded as unskilled,
such as waiting tables.

jabhatta2 · Answer

Hi  GMATNinja

Question on 413

How can you say (C) is accurate in all scenario's ?

While i agree that (C) is right when it comes to cheap restaurants per the passage ...we do not know if this phenomena is right when it comes to expensive restaurants

Hence i said to myself

hmm we don't know if this is true all the time (in all scenario's, specifically for high end restaurants) -- so while this is accurate for cheap restaurants , we don't know about expensive restaurants

GMATNinja · Answer

Question 2 Mmm... restaurants.

:tongue_opt2 Remember that the question asks us to infer which statement "the author of the passage would agree with " -- not which statement is "true all the time" or in "all scenarios," as you state in your analysis. Take another look at (C): To choose (C) as our answer, we only need to prove that the author would agree that a service guarantee would have less appeal in this scenario ("where customers are knowledgeable about a business’s product or service"). We do not need to prove that (C) is accurate in " all scenarios." Let's take a look at the piece in the passage most relevant to answer choice (C): In saying "a restaurant," the author implies that Tucci and Tagala's finding applies to restaurants in general, not just inexpensive restaurants. Customers generally know what to expect at a restaurant and can therefore question the quality of the product or service. This is contrasted to "skilled activities," about which a customer may not feel empowered to question quality. A guarantee of service would have more appeal in the second case than in the first. The author's reason for bringing up what customers understand about a restaurant's product is not to contrast lower-priced and higher-priced restaurants. Rather, the author is making a broader suggestion about how customers behave when considering different types of products and skills. That's why we have good reason to believe the author would agree with choice (C). I hope that helps!

blueshores · Answer

Can anyone explain the answer for question 3 ?
Why is it C and not D.
In the 3rdpara 3rd last line it's mentioned about quality of service .

Posted from my mobile device

GMATNinja · Answer

Question 3 
 
Question 3 asks what effects a service guarantee can have when offered by lower-priced restaurants. Here is the piece of the passage relevant to answering this question:
 
Let's first take a look at answer choice (D):
 
There are a couple of issues with this statement. First, the "negative effect" mentioned in the passage is that customers will  think  that the restaurant is worried about the quality of service, which is different than the restaurant  actually  being concerned about its service. In addition, the expectation of "less assiduous service" is already there  before  the hypothetical service guarantee is in place, simply because the restaurant is lower-priced. So, it does not make sense that the restaurant will "become concerned" that its service will not be assiduous enough  after  putting a service guarantee is in place.

For these reasons, (D) is out.

Now take a look at (C):
 
This closely mirrors the information in the passage, that "a potential customer might think that a restaurant offering a guarantee is worried about its service." (C) is the correct answer.

I hope that helps!

NikitaVChoudhary · Answer

Can someone explain why E is wrong in the 1st question?(Primary purpose)

Rachit4126 · Answer

Hi, In addition to all the replies above regarding Q1 choice elimination. Here's what i would suggest: 1. Read the passage again and look for the Tone of the passage. Ask questions- Why the 1st para has been mentioned by the Author. Its there to put forward a context for the discussion for this pAssage- It talks about a study done by Some person T&T. Further para describe or DISUCSS the MIXED aspects(as mentioned in Para 1) of the study. In last para is when the Author actually presents his views providing another aspect of restaurants which might get benefitted OR IMPACTED by the service guarantee. So in essence Author has been DISCUSSING T&T's study all through and only presents his facts in the last few lines or PARA. Pls now approach the Q1, i am sure you should be doing better to eliminate the wrong choices. 2. blitzkriegxX also has summarized the expirations well. If you don't want to go through the complete chain of explanations again. Hope it helps

reynaldreni · Answer

The primary purpose of the passage is to:
B. discuss potential advantages and disadvantages of service-quality guarantees in the  restaurant industry 
E. consider the impact that service-quality guarantees can have on the service provided by  a restaurant

In general, impact means effect or influences. Option E talks about the services provided by a restaurant in specific. Option B talks about the restaurant industry in general. Although the first paragraph starts about visit to particular restaurant, the passage as a whole is more focused on service-quality guarantees in the restaurant industry as a whole. Moreover, the focus is on the advantages and disadvantages that service-quality can have in the industry. As a support refer to Line 5,6, 20.

Let me know what you think.

GMATNinja ,  mikemcgarry ,  ScottTargetTestPrep ,  VeritasKarishma  please could you kindly advise if my reasoning is right?
Many Thanks.

ScottTargetTestPrep · Answer

While much of what you said makes sense, I think you could have more clearly defined the key difference between (B) and (E).

Notice that (E) is focused on the impact of service-quality guarantees on service only, whereas (B) is about the advantages and disadvantages in general of service-quality guarantees.

Thus, since the passage discusses effects other than effects on service, and since it discusses both disadvantages and advantages of service-quality guarantees, such as those related to customer selection of restaurants and the utility of service-quality guarantees in managing staff, (B) better captures the primary purpose of the passage than (E) does.

Jainam24 · Answer

In Q1 of primary purpose, could eliminate A on sollid grounds. Felt B is correct but I still feel I stuumbled into the ans because POE wasn't solid. How could I have eliminated the other options to arrive at the ans?
Curious to know your approach to POE. Thanks in advance

KarishmaB · Answer

The primary purpose of the passage is to
A. question the results of a study that examined the effect of service-quality guarantees in the restaurant industry

The passage doesn't question the results. It gives the results of the study.

B. discuss potential advantages and disadvantages of service-quality guarantees in the restaurant industry

Correct. 
Some advantages to high end restaurants, some disadvantages to low end. But for most restaurants, advantages in terms of motivating staff.

C. examine the conventional wisdom regarding the effect of service-quality guarantees in the restaurant industry

The author does not discuss conventional wisdom at all. She gives the results of a recent study (Note the use of "have found" here -  Tucci and Talaga have found that .. . so the study is recent) and then adds to them.

D. argue that only certain restaurants would benefit from the implementation of service-quality guarantees

She says that 
 For restaurants generally, the main benefit of a service guarantee probably lies not so much in customer appeal as in managing and motivating staff.

So generally, restaurants can benefit from it.

E. consider the impact that service-quality guarantees can have on the service provided by a restaurant

She does do this but that is one part of the whole passage. She discusses the study's results in detail to give the advantages and disadvantages. While discussing this point also, she is giving an advantage "the main benefit of a service guarantee probably lies..." It is clear that her intent is to discuss the advantages and disadvantages. 
Hence, (B) is better.

Answer (B)

nitishjain0109 · Answer

Hello  GMATNinja  
Thank you for the answer brief. However, I still find it hard to understand what the author means when he says:  they are empowered to question its quality.

Doesn't he mean that  if a person knows the service, s/he questions (Doubts) the quality?  
Even though it wouldn't make sense for people to doubt the quality if they are certain of the service quality but still as I was reading I understood this meaning.

In their study of whether offering a guarantee of service quality will

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GMAT Reading Comprehension (RC) Questions

In their study of whether offering a guarantee of service quality will

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