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# While manufacturing tasks at Foldaco

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Intern
Joined: 15 Jun 2015
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Updated on: 21 Jul 2015, 23:20
4
00:00

Difficulty:

65% (hard)

Question Stats:

52% (01:37) correct 48% (01:27) wrong based on 269 sessions

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While manufacturing tasks at Foldaco are performed by human workers, at Boksco they are all done by programmed robots. Because of this, fewer workers are needed at Boksco while the output levels of the company match those of Foldaco. Clearly, Boksco's operational expenses are lower than those of Foldaco.

The answer to which of the following would be most useful in evaluating the argument?

Do the robots used by Boksco require maintenance for them to achieve optimum output levels?

Do the workers at Foldaco undergo specialized training before they are allowed to perform their tasks?

Are retail prices for products manufactured by Boksco much higher than those manufactured by Foldaco?

How long ago did Boksco complete the process of integrating the robots into its manufacturing system?

Is the sum of the wages of the workers at Boksco higher or lower than that of the workers at Foldaco?

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Originally posted by target2015 on 28 Jun 2015, 02:44.
Last edited by target2015 on 21 Jul 2015, 23:20, edited 1 time in total.
Manager
Joined: 21 Aug 2012
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Concentration: General Management, Operations
Schools: HBS '19 (S)
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30 Jun 2015, 10:14
Why not A? ... the maintenance of robots will increase the operational costs ...
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01 Jul 2015, 11:09
roopika2990 wrote:
Why not A? ... the maintenance of robots will increase the operational costs ...

I am definitely sure about Why not A. They require maintenance lets say. How expensive is maintaining these robots?? Or does that add substantially to the operations cost of the company. these questions when answered can tell us if A suffices.

But I am not sure about E. Operations cost involve a load of things other than employee wages only. even if the total wages are greater/less, what about other expenses suppose transportation, or logistics etc. I dont find any of these options correct.

Intern
Joined: 17 Feb 2015
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WE: Sales (Consulting)

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01 Jul 2015, 13:00
target2015 wrote:
While manufacturing tasks at Foldaco are performed by human workers, at Boksco they are all done by programmed robots. Because of this, fewer workers are needed at Boksco while the output levels of the company match those of Foldaco. Clearly, Boksco's operational expenses are lower than those of Foldaco.

The answer to which of the following would be most useful in evaluating the argument?

Do the robots used by Boksco require maintenance for them to achieve optimum output levels?

Do the workers at Foldaco undergo specialized training before they are allowed to perform their tasks?

Are retail prices for products manufactured by Boksco much higher than those manufactured by Foldaco?

How long ago did Boksco complete the process of integrating the robots into its manufacturing system?

Is the sum of the wages of the workers at Boksco higher or lower than that of the workers at Foldaco?

Though I marked A, after reading the options again E makes much more sense.
We could deny A on the fact that we don't know if the maintenance is actually taken care by BOKSCO team or by the machine vendor. Whereas E,though not taking about other operational expenses, gives us a comparison between the sum of wages.

Would like to get some experts views.
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02 Jul 2015, 00:40
isnt 'E' just a rephrase of the conclusion?..i picked 'A', and cant understand why 'E' is the answer. I hate these kind of questions where there is one option which makes direct sense and then there is another option, which has another twisted meaning, which would eventually make more sense!..Seen a lot of these on the forum!
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02 Jul 2015, 00:53
The conclusion of the argument is - Boksco's operational expenses are lower than those of Foldaco.

Only option E deals with operational expenses...thus it is the answer
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Intern
Joined: 23 Jan 2012
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Concentration: Entrepreneurship, General Management
WE: Consulting (Internet and New Media)

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15 Oct 2015, 11:16
I'm not convinced with E.

Wages are not the only ops expenses and maintenance is definitely one thing to be taken into account.
IMO wages should be one of the questions, but not the most relevant.

By elimination, I ended up with E but A is quite attractive...

any other approach?
Manager
Joined: 15 May 2010
Posts: 159
Location: India
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16 Oct 2015, 01:32
1
There are so many assumptions to be made in order to arrive at E.

We don't know the number of workers in both companies. What we only know is that Boksco has fewer workers than foldaco.
We also don't know the wages/worker for both companies.

So many data is required to conclude whether sum of the wages of the workers at Boksco higher or lower than that of the workers at Foldaco.
Manager
Joined: 29 Mar 2015
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Concentration: Strategy, Operations
GMAT 1: 700 Q51 V33
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17 Oct 2015, 03:18
target2015 wrote:
While manufacturing tasks at Foldaco are performed by human workers, at Boksco they are all done by programmed robots. Because of this, fewer workers are needed at Boksco while the output levels of the company match those of Foldaco. Clearly, Boksco's operational expenses are lower than those of Foldaco.

The answer to which of the following would be most useful in evaluating the argument?

Do the robots used by Boksco require maintenance for them to achieve optimum output levels?

Do the workers at Foldaco undergo specialized training before they are allowed to perform their tasks?

Are retail prices for products manufactured by Boksco much higher than those manufactured by Foldaco?

How long ago did Boksco complete the process of integrating the robots into its manufacturing system?

Is the sum of the wages of the workers at Boksco higher or lower than that of the workers at Foldaco?

My 0.02\$ on E here....

Operations cost at Foldaco = Workers wages (W1) (other cost we can ignore - like supply chain etc etc...as that is the case with Boksco also.)
Operations cost at Boksco = Workers wages (W2) + cost of operating of robots(R2) (Well here I am assuming that cost of operating robots >0 - I believe this is a valid assumption also)

Now for conclusion to be valid we need to consider that fact that W1>W2 to compensate for additional cost of R2. Incase we find that W1<W2 our conlusion will collapse.

I hope it helps.

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Intern
Joined: 10 Oct 2014
Posts: 21
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17 Oct 2015, 18:02
Was caught up about E when answering the question, because I thought "if there's only one employee at Boksco, then their salary can't be higher than all the workers at Foldaco." But it could be. One guy could make 10 million dollars, and all of Foldaco's employees only make \$5 MM combined.

Reference this question for similar logic:
in-patton-city-days-are-categorized-as-having-heavy-65469.html
Intern
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28 Sep 2018, 12:06
Who tags the difficulty of the questions? This is not 700.
I am struggling through the CATs to get a 600; it is misleading to see the difficulty of questions at gmatclub and base on them.
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