Corporate Officer: Last year was an unusually poor one for our chemical division, which has traditionally contributed about 60 percent...
GMAT Critical Reasoning : (CR) Questions
Corporate Officer: Last year was an unusually poor one for our chemical division, which has traditionally contributed about 60 percent of the corporation's profits. It is therefore encouraging that there is the following evidence that the pharmaceutical division is growing stronger: it contributed 45 percent of the corporation's profits, up from 20 percent the previous year.
On the basis of the facts stated, which of the following is the best critique of the evidence presented above?
Passage Analysis:
| Text from Passage | Analysis |
| Last year was an unusually poor one for our chemical division, which has traditionally contributed about 60 percent of the corporation's profits. |
|
| It is therefore encouraging that there is the following evidence that the pharmaceutical division is growing stronger: it contributed 45 percent of the corporation's profits, up from 20 percent the previous year. |
|
Argument Flow:
The officer starts by explaining a problem (chemical division had a poor year despite usually contributing 60% of profits), then presents what appears to be good news (pharmaceutical division grew from 20% to 45% of profits) as evidence that the pharma division is getting stronger.
Main Conclusion:
The pharmaceutical division is growing stronger, as evidenced by its increased profit contribution.
Logical Structure:
The argument assumes that because pharma's percentage of total profits increased dramatically, this means pharma itself is growing stronger. However, this reasoning has a major flaw - we don't know if total company profits went up, down, or stayed the same. If total profits dropped significantly due to the chemical division's poor performance, pharma could be contributing a bigger percentage of a much smaller pie without actually growing at all.
Prethinking:
Question type:
Misc - This is asking us to critique the evidence presented, which means we need to find flaws in how the corporate officer is interpreting the data or drawing conclusions from it.
Precision of Claims
The claims involve specific percentages (60%, 45%, 20%) and comparative statements about divisional performance across time periods. The officer is making a qualitative judgment (pharmaceutical division is 'growing stronger') based on quantitative data.
Strategy
We need to identify logical flaws in how the officer interprets the percentage changes. The key issue is likely that the officer is assuming the pharmaceutical division's increased percentage share means it's actually performing better, when it could just be that total corporate profits dropped significantly due to the chemical division's poor performance. We should look for critiques that point out this percentage vs. absolute value confusion.
This critique suggests the growth could be due to a single new product rather than overall division strength. While this might be a valid concern about sustainability, it doesn't address the fundamental flaw in the officer's reasoning. Even if growth came from one product, it would still represent actual growth, which isn't the core issue here.
This statement about industry norms for pharmaceutical divisions is completely irrelevant to critiquing the evidence presented. We're not comparing this company to industry standards - we're evaluating whether the evidence supports the conclusion about division strength.
This hits the nail on the head! Since the chemical division had an unusually poor year, total corporate profits likely dropped significantly. The pharmaceutical division could be getting a bigger slice of a much smaller pie without actually improving its performance at all. This directly challenges the officer's assumption that increased percentage equals improved strength.
While we don't know if the previous 20% was an improvement, this doesn't critique the current evidence. The officer's reasoning flaw exists regardless of what happened before the previous year. This misses the core issue of percentage versus actual performance.
The inability to compare the two divisions isn't the problem here. The officer isn't trying to compare divisions - they're trying to conclude that pharma is growing stronger based on percentage changes. This critique doesn't address the logical flaw in that reasoning.