Marketing executive for Magu Corporation: Whenever Magu opens a manufacturing facility in a new city, the company should sponsor, or...
GMAT Critical Reasoning : (CR) Questions
Marketing executive for Magu Corporation: Whenever Magu opens a manufacturing facility in a new city, the company should sponsor, or make donations to, a number of nonprofit organizations in that city. Doing so would improve Magu's image in the community, and thus the money spent on such charitable ventures would lead to increased sales.
Which statement would, if true, point to the most serious weakness in the marketing executive's advice?
Passage Analysis:
| Text from Passage | Analysis |
|---|---|
| Whenever Magu opens a manufacturing facility in a new city, the company should sponsor, or make donations to, a number of nonprofit organizations in that city. |
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| Doing so would improve Magu's image in the community |
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| and thus the money spent on such charitable ventures would lead to increased sales |
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Argument Flow:
The argument follows a simple cause-and-effect chain: charitable donations → improved community image → increased sales. The marketing executive presents this as a straightforward business strategy where spending money on charity pays off through better sales.
Main Conclusion:
Magu should donate to local nonprofits when opening new facilities because this will boost sales through improved community relations.
Logical Structure:
The argument assumes two key links: (1) donations automatically improve community image, and (2) better image directly translates to increased sales. The executive treats both connections as guaranteed outcomes without considering potential problems or alternative explanations.
Prethinking:
Question type:
Weaken - We need to find information that would reduce our belief in the marketing executive's conclusion that charitable donations will lead to increased sales
Precision of Claims
The argument makes specific claims about causation: donations → improved community image → increased sales. The executive assumes this chain will work reliably and that the financial benefit will outweigh the costs
Strategy
To weaken this argument, we need to find scenarios that break the causal chain or show why the expected outcome won't happen. We can attack either the connection between donations and improved image, or between improved image and increased sales. We should look for situations where the logic falls apart even if we accept that Magu will make donations
Magu sells its products internationally, so sales in any one city represent only a small portion of total revenue.
This choice suggests that sales in any one city are just a small portion of total revenue. However, this doesn't actually weaken the executive's logic - even if the impact is small in terms of total company revenue, the executive's core argument that donations lead to increased sales in that specific market could still be valid. The executive never claimed this strategy would dramatically boost overall company performance, just that it would increase local sales.
Spending on charitable ventures would require Magu to decrease direct advertisements, which are the most effective means of reaching its target customers.
This presents the most serious weakness because it introduces a critical trade-off. If charitable spending forces Magu to cut back on direct advertisements (described as the most effective way to reach target customers), then the charitable strategy could actually decrease sales rather than increase them. This directly contradicts the executive's conclusion and shows how the proposed strategy might backfire by eliminating more effective sales-generating activities.
If market conditions change, Magu may have to close any such facility or relocate it.
The possibility that facilities might close or relocate doesn't weaken the executive's argument about the effectiveness of charitable donations while the facility is operating. The executive's logic about donations improving community image and sales could still be sound during the facility's operational period, even if business conditions later force changes.
Some nonprofit organizations are poorly organized, so money donated to them would be of little benefit to the community.
While poorly organized nonprofits might not help the community as much, this doesn't necessarily prevent the donations from improving Magu's image. The community might still view Magu favorably for making charitable efforts, regardless of how well the nonprofits use the money. The executive's argument focuses on image improvement, not actual community benefit.
If workers at the manufacturing facility believed their wages or working conditions were poor, their complaints would outweigh any good impressions generated by Magu's donations or sponsorships.
This introduces a scenario about worker complaints, but it doesn't directly address the executive's specific strategy. The executive could potentially argue that charitable donations, while not solving all image problems, would still provide some positive community relations benefit. This creates a competing factor rather than showing the charitable strategy itself is flawed.