Electronics manufacturer: Developing a line of smartphones would

Question

Electronics manufacturer:  Developing a line of smartphones would require a research-and-development push that would directly trade off with our R&D efforts on five other products. Plus, a line of MP3 players - another product we have discussed developing - has an inherently higher profit potential than a line of smartphones and would be cheaper to manufacture.

The electronics manufacturer's statements, if true, most strongly support which one of the following?

(A) Developing a line of MP3 players would not trade off with the R&D efforts on an other products.
(B) The manufacturer is more likely to make money by developing a line of MP3 players than it is by developing a line of smartphones.
(C) Developing a line of smartphones would be a bad business decision for the manufacturer.
(D) The manufacturer will make money if it develops a line of MP3 players.
(E) The only new product that would be profitable for the manufacturer is a line of MP3 players.

Source: McGraw Hill LSAT

sobby · Answer

This is good one ...my reasoning on this:
A---we dont know weather it will trade off other product ..may be / may be not
B--yes , as suggested in last line of the argument ---
C-- again the decision is bad or good , it will depend on future stats .
D-this is very stong --will make money ....B is good here 
E--this is again very stong---we can eliminate it

nks2611 · Answer

isn't option B is already stated in stimulus ? , its more like inference Q,

anje29 · Answer

Yes this is a inference question as per the question stem. Therefore , its answer is justified.

Bhavanahiremath · Answer

The statement says - 'higher profit potential by making MP3 Players'. That doesnt directly mean 'more like to make money' or is it? If it said 'more like to make more money' then it would be more likely to be more accurate

Just asking because I eliminated this answer choice since it says 'make money' and not 'make more money'. Nowhere does the passage say that by manufacturing smartphones the manufacturer will not make any money at all. Please explain.

abhimahna · Answer

The argument is saying two things:

1. Developing a line of smartphones would require R&D and would tarde off with 5 other products.
2. A line of MP3 players is more profitable and is produced at low cost.

We need to Infer something out of this. Let's do it using POE.

(A) Developing a line of MP3 players would not trade off with the R&D efforts on an other products.  : Too extreme. How do we know it would not trade off. No such information is given and this cannot be inferred.

(B) The manufacturer is more likely to make money by developing a line of MP3 players than it is by developing a line of smartphones.  : Yes, even if they both require same trade off with the 5 other products, we know the the latter is more profitable. Hence, the chances of making money in latter case is more. Hence, correct answer.

For those who are confused why we don't have more money here: Consider a scenario when we are using the same amount of Money for manufacturing the two products. While the former may not given any profit, the latter will for sure give some profit (if sold at the same price) as we know that the latter is manufactured at a lower cost.

(C) Developing a line of smartphones would be a bad business decision for the manufacturer.  : Ohh. How can you say it is a bad business??

(D) The manufacturer will make money if it develops a line of MP3 players.  : Will make money. Aren't we too confident here? I would always reject this option.

(E) The only new product that would be profitable for the manufacturer is a line of MP3 players.  No Man, I have another product which could be more profitable. So, that will break your point. Hence, incorrect

TheMechanic · Answer

Further to this, be mindful that paraphrased answer choices are correct in Inference Questions. Hence B is correct.

Profit margins are greater on MP3s than it is on smartphones implies that, if the company sells 1 MP3 and 1 smartphone, it will likely make larger profitable income on selling the MP3 than is the case by selling smart phones. The same is stated in answer.

Hope this helps.

jedit · Answer

Electronics manufacturer: Developing a line of smartphones would require a research-and-development push that would directly trade off with our R&D efforts on five other products. Plus, a line of MP3 players – another product we have discussed developing – has an inherently higher profit potential than a line of smartphones and would be cheaper to manufacture.

The electronics manufacturer’s statements, if true, most strongly support which one of the following?

A) Developing a line of MP3 players would not trade off with the R&D efforts on an other products.
B) The manufacturer is more likely to make money by developing a line of MP3 players than it is by developing a line of smartphones.
C) Developing a line of smartphones would be a bad business decision for the manufacturer.
D) The manufacturer will make money if it develops a line of MP3 players.
E) The only new product that would be profitable for the manufacturer is a line of MP3 players.

Source: I found it a very good question. I am sorry I am not aware of the source but would love for due credits to be added so if anyone knows the source, please post it here so that I can request mods to add it to the question.

deepmaity · Answer

B is more likely to be the winner.

Sent from my Moto G (5) Plus using  GMAT Club Forum mobile app

jedit · Answer

You are very right. I edited OA.

sananoor · Answer

Its an inference question so any answer choice that goes out of the given info is wrong
A--->well R&D compromise only when it has to research on smartphone line but we cant infer that the department will compromise its effort for MP3 line
B--->yes this is the answer the argument says that it can generate profit and cheaper to manufacture...B says it is likely...the statement isnt using he xtreme words but saying that it is likely that it will make profit more than through smartphones
C--->we cant infer such an extreme result
D--->we cant say that it will make money, what if the company wont be able to sale enough players to generate profit?
E---->again extreme conclusion

mostasha · Answer

This question is NOT a strengthen question. This question should be categorized as a MBT or inference question.

sallysea · Answer

Merged topics. Please, search before posting questions!

VerbalBot · Answer

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Electronics manufacturer: Developing a line of smartphones would

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