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02 Mar 2023, 02:30
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B
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:
86% (01:41) correct
14%
(02:11)
wrong
based on 222
sessions
History
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Not Attempted Yet
The First Banking Group's decision to invest in an electronic network for transferring funds was based on a cost advantage over a nonelectronic system of about ten dollars per transaction in using an electronic system. Executives reasoned further that the system would give them an advantage over competitors.
Which of the following, if it is a realistic possibility, most seriously weakens the executives' projection of an advantage over competitors?
(A) The cost advantage of using the electronic system will not increase sufficiently to match the pace of inflation.
(B) Competitors will for the same reasons install electronic systems, and the resulting overcapacity will lead to mutually damaging price wars.
(C) The electronic system will provide a means for faster transfer of funds, if the First Banking Group wishes to provide faster transfer to its customers.
(D) Large banks from outside the area served by the First Banking Group have recently established branches in that area as competitors to the First Banking Group.
(E) Equipment used in the electronic network for transferring funds will be compatible with equipment used in other such networks.
Which of the following, if it is a realistic possibility, most seriously weakens the executives' projection of an advantage over competitors?
(A) The cost advantage of using the electronic system will not increase sufficiently to match the pace of inflation.
(B) Competitors will for the same reasons install electronic systems, and the resulting overcapacity will lead to mutually damaging price wars.
(C) The electronic system will provide a means for faster transfer of funds, if the First Banking Group wishes to provide faster transfer to its customers.
(D) Large banks from outside the area served by the First Banking Group have recently established branches in that area as competitors to the First Banking Group.
(E) Equipment used in the electronic network for transferring funds will be compatible with equipment used in other such networks.
02 Mar 2023, 10:31
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Bunuel
I am stuck between B and E.
B because the damaging price war might make all the companies using the tech reduce the price so this kills the advantage. E because in order for the system to work we need some equipments to setup the whole network and this take some money (profits= Rev - Cost). I still think E is a better weakener than C.
Open for any kinds of discussions!
Thanks in advance
03 Mar 2023, 09:02
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Ps1810
Ps1810 but the question stem clearly states most seriously weakens the executives' projection of an advantage over competitors
I would think that choice (E) is irrelevant since we are not really concerned with how the funds are transferred but to weaken the argument's conclusion, which choice (B) does clearly. If the Competitors install electronic systems not only the advantage will be lost but also lead to damaging price wars.
