The OLEX Petroleum Company has recently determined that it

Question

The OLEX Petroleum Company has recently determined that it could cut its refining costs by closing its Grenville refinery and consolidating all refining at its Tasberg refinery. Closing the Grenville refinery, however, would mean the immediate loss of about 1,200 jobs in the Grenville area. Eventually the lives of more than 10,000 people would be seriously disrupted. Therefore, OLEX's decision, announced yesterday, to keep Grenville open shows that at OLEX social concerns sometimes outweigh the desire for higher profits.

Which of followings, if true, most seriously undermines the argument given?

(A) The Grenville refinery, although it operates at a higher cost than the Tasberg refinery, has nevertheless been moderately profitable for many years.

(B) Even though OLEX could consolidate all its refining at the Tasberg plant, doing so at the Grenville plant would not be feasible.

(C) The Tasberg refinery is more favorably situated than the Grenville refinery with respect to the major supply routes for raw petroleum.

(D) If the Grenville refinery were ever closed and operations at the Tasberg refinery expanded, job openings at Tasberg would to the extent possible be filled with people formerly employed at Grenville

(E) Closure of the Grenville refinery would mean compliance, at enormous cost, with demanding local codes regulating the cleanup of abandoned industrial sites.

durgesh79 · Answer

E. Gives us another reason why OLEX is not closing the Grenville refinery.... social concern is not the only reason ...

noboru · Answer

And why not D?
D explains that the job losses are not a problem.
please clarify.

sridhar · Answer

I am with E too.. Thats the only option that says the company didn't move because of cost reasons and not because of social reasons.

seekmba · Answer

E is best because OLEX has decided to run the company not because of social concerns but because it will have to bear enormous cost of cleanup in case if they closed.

Success2015 · Answer

I eliminated D using this reasoning - 
given in D - job opening at G would go to T, to the extent possible.

lets say 100% of jobs can be moved to T...then why is the G refinery not getting closed? there will be no impact to lives/jobs of people.
OR
lets say only 1% of jobs can be moved to T...in this case there will be an impact. Due to the social concern the company may not be closing the G refinery.

hence it does not weaken the argument's main point - social concern outweighs the desire for profits.

it would help if somebody can validate this reasoning..thanks

sa18 · Answer

Hi

I wanted to know why is A incorrect?
Afterall if that location provides marginal profits then why would someone shut it down.

Ekland · Answer

A is NOT the answer because of the presence of E

sleepynut · Answer

In my 2 cents,
A is not correct.The reason of consolidation is solely due to the cost cutting;we know nothing about the profit condition of these two refineries.All of the refineries could generate moderate profit!! hence,it is unjustifiable.

dnalost · Answer

Option E clearly says that there were additional economic reasons due to which the Grenville refinery was not closed.

amathews · Answer

E - provides another reason i.e. X does not cause Y but A causes Y

Shah10 · Answer

Answer: E.

E gives us an alternate reason as to why Grenville was not closed, and undermines the argument that it remained open for social reasons.

blitzkriegxX · Answer

The OLEX Petroleum Company has recently determined that it could cut its refining costs by closing its Grenville refinery and consolidating all at its Tasberg refinery. Closing the Grenville refinery, however, would mean the immediate loss of about 1,200 jobs in the Grenville area. Eventually the lives of more than 10,000 people would be seriously disrupted. Therefore, OLEX's decision, announced yesterday, to keep Grenville open shows that at OLEX social concerns sometimes outweigh the desire for higher profits.

Which of followings, if true, most seriously undermines the argument given?

(A) The Grenville refinery, although it operates at a higher cost than the Tasberg refinery, has nevertheless been moderately profitable for many years.
G operation cost is higher than T and G is is only moderately profitable. For this option to undermine the conclusion, we will have to assume a lot of things. We will have to assume that G is more profitable compared to T. Or that T is in loss/ has low profits even though the operation cost is lower compared to G.
Usually when we have such options where we have to make too many assumptions, it is better to not fall in love with the option and just hold it. You will see how we have some other option which is a bit more direct and avoids too many such assumptions.

(B) Even though OLEX could consolidate all its refining at the Tasberg plant, doing so at the Grenville plant would not be feasible.
Are they not doing it because they care about the people and not not care about the money OR is there some other reason which will help undermine the conclusion?
This option does not really give us any such info to answer the above question. And we already know from premises that shifting to T will be beneficial.

(C) The Tasberg refinery is more favorably situated than the Grenville refinery with respect to the major supply routes for raw petroleum.
Again supports the argument. Even though there is another good reason to reduce costs, company is choosing to stay at G.

(D) If the grenville refinery were ever closed and operations at the Tasberg refinery expanded, job openings at Tasberg would to the extent possible be filled with people formerly employed at Grenville
An important part to notice here is "to the extent possible". If anything, this strengthens the argument.
If there are 100 jobs at G. By shifting to T, the 100 jobs are gone.
Now they will move the jobs, "to the extent possible" say 50 jobs to T.
But the company is against moving to T. This means that the company actually cares about the other 50 jobs that they cannot fill. Hence if the above option is true it may strengthen the conlusion!

(E) Closure of the Grenville would mean compliance, at enormous cost, with demanding local codes regulating the cleanup of abandoned industrial sites.
This is pretty direct. They did not close G because they care about jobs. But this option says otherwise! Opening a new possible reason associated with not moving to T!

Hope this helps!

dcummins · Answer

The argument is that O's decision to keep G open shows that at O social concerns sometimes outweigh the desire for higher profits.

This is supported by O's decision not to refinery G.

We are asked to weaken this.
A is incorrect - moderate profitability could still persuade O to consolidate operations at a more profitable location. It doesn't negate or weaken the position that O pursued a more socially minded decision
B is incorrect - the argument is concerned with consolidating operations at T. The fact O cant consolidate at G doesn't mean it is less concerned about profit.
C is not conducive to the argument and therefore incorrect.
D shows that O is actually socially minded- Incorrect.
E is correct because it shows that O potentially kept G open because of the enormous compliance costs - which would hinder profit.

VerbalBot · Answer

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