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17 May 2021, 07:30
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E
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
15%
(low)
Question Stats:
85% (01:31) correct
15%
(01:50)
wrong
based on 170
sessions
History
Date
Time
Result
Not Attempted Yet
Contrary to a former estimation made by the head of the tourism industry of Country X, there was no rise in the number of tourists or in the average sum of money spent by each tourist in the past year. There was, however, a steep increase of almost 20 percent in profits from the tourist industry in that time span.
Which of the following statements, if true, help to explain the rise in profits?
A. The tourists last year came mostly from developed countries, whereas previously most tourists came from developing countries.
B. A rise of 20% was estimated for last year in the amount of tourists expected to frequent Country X.
C. Following a long strike, employers in the tourism industry were forced at the beginning of last year to raise salaries by 20%.
D. A change in the foreign ministry of Country X, which was authorised at the beginning of last year, has made it much easier for tourists to enter the country.
E. A general rise in unemployment throughout the country enabled employers in the tourism industry to significantly cut salaries at the beginning of last year.
Which of the following statements, if true, help to explain the rise in profits?
A. The tourists last year came mostly from developed countries, whereas previously most tourists came from developing countries.
B. A rise of 20% was estimated for last year in the amount of tourists expected to frequent Country X.
C. Following a long strike, employers in the tourism industry were forced at the beginning of last year to raise salaries by 20%.
D. A change in the foreign ministry of Country X, which was authorised at the beginning of last year, has made it much easier for tourists to enter the country.
E. A general rise in unemployment throughout the country enabled employers in the tourism industry to significantly cut salaries at the beginning of last year.
23 May 2021, 06:00
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OFFICIAL EXPLANATION
Contrary to a former estimation made by the head of the tourism industry of Country X, there was no rise in the number of tourists or in the average sum of money spent by each tourist in the past year. There was, however, a steep increase of almost 20 percent in profits from the tourist industry in that time span.
Which of the following statements, if true, help to explain the rise in profits?
A. The tourists last year came mostly from developed countries, whereas previously most tourists came from developing countries.
Incorrect.
This is a Paradox question, so it is made up of premises only; you need to find a new premise which best resolves the apparent discrepancy between the existing premises:
- Premise A: There hasn't been any increase in the number of tourists or the sum each tourist spent on average, i.e. no rise in revenues.
✖
Premise B: There has been an increase of almost 20% in profits from the tourist industry, i.e. a steep rise in profits.
Resolving Premise: ?
This answer choice would have been correct if we hadn't known that the average revenues remained the same.
B. A rise of 20% was estimated for last year in the amount of tourists expected to frequent Country X.
Incorrect.
We know from the first sentence that the estimates for last year's tourist industry were wrong (there was no rise).
C. Following a long strike, employers in the tourism industry were forced at the beginning of last year to raise salaries by 20%.
Incorrect.
If the employers had to take more money out of their pockets, the expenses in the industry would rise and the profits would drop. This answer choice does not resolve the paradox, it emphasizes it.
D. A change in the foreign ministry of Country X, which was authorised at the beginning of last year, has made it much easier for tourists to enter the country.
Incorrect.
We know that the amount of tourists which actually entered Country X remained the same, so the fact that it was easier for tourists to enter the country had no influence over the overall profits of the industry.
E. A general rise in unemployment throughout the country enabled employers in the tourism industry to significantly cut salaries at the beginning of last year.
A steep decrease in salaries lowers the expenses, a fact which goes a long way to help explain how even though the revenues stayed the same, the overall profits (=revenues-costs) grew by almost 20%.
General Discussion
17 May 2021, 07:54
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I choose option E.
Premises say - No rise in tourist numbers and no rise in avg sum soent by the tourists.
Conclusion - profits rise by 20%
I.e selling prices of items must have increased ot cost spent must have decreased.
Opt A - irrelevant. Doesnt matter if tourists came frm developed or developing countries
opt B - increase in tourists . We r told that tourist traffic hasnt risen much.
Opt C - if salaries are raised , them costs for tourist industry must have increased, thereby reducing profits.
Opt D - making a policy easier implies more tourists would arrive. But premise says tourist count stays more or less the same .
OPT E- right answer . If unemployment has increased across all sectors, means costs for the tourist company also must have reduced thereby increasing their profits.
Correct me if im wrong in my analysis.
Thanks
Posted from my mobile device
Premises say - No rise in tourist numbers and no rise in avg sum soent by the tourists.
Conclusion - profits rise by 20%
I.e selling prices of items must have increased ot cost spent must have decreased.
Opt A - irrelevant. Doesnt matter if tourists came frm developed or developing countries
opt B - increase in tourists . We r told that tourist traffic hasnt risen much.
Opt C - if salaries are raised , them costs for tourist industry must have increased, thereby reducing profits.
Opt D - making a policy easier implies more tourists would arrive. But premise says tourist count stays more or less the same .
OPT E- right answer . If unemployment has increased across all sectors, means costs for the tourist company also must have reduced thereby increasing their profits.
Correct me if im wrong in my analysis.
Thanks
Posted from my mobile device
