Transnational cooperation among corporations is experiencing a modest renaissance among United States firms, even though projects undertaken by two or...

GMAT Critical Reasoning : (CR) Questions

Source: Official Guide

Critical Reasoning

Misc.

HARD

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Transnational cooperation among corporations is experiencing a modest renaissance among United States firms, even though projects undertaken by two or more corporations under a collaborative agreement are less profitable than projects undertaken by a single corporation. The advantage of transnational cooperation is that such joint international projects may allow United States firms to win foreign contracts that they would not otherwise be able to win.

Which of the following is information provided by the passage?

Transnational cooperation involves projects too big for a single corporation to handle.

Transnational cooperation results in a pooling of resources leading to high-quality performance.

Transnational cooperation has in the past been both more common and less common than it is now among United States firms.

Joint projects between United States and foreign corporations are not profitable enough to be worth undertaking.

Joint projects between United States and foreign corporations benefit only those who commission the projects.

Solution

Passage Analysis:

Text from Passage	Analysis
Transnational cooperation among corporations is experiencing a modest renaissance among United States firms	What it says: US companies are starting to work together with foreign companies more than before What it does: Sets up the topic - tells us there's a trend happening What it is: Author's observation about current business trends
even though projects undertaken by two or more corporations under a collaborative agreement are less profitable than projects undertaken by a single corporation	What it says: Joint projects make less money than solo projects What it does: Creates a puzzle - why would companies do something that makes less money? What it is: Author's contrasting fact Visualization: Solo Project: $100 profit vs Joint Project: $70 profit
The advantage of transnational cooperation is that such joint international projects may allow United States firms to win foreign contracts that they would not otherwise be able to win	What it says: Working together helps US companies get overseas contracts they couldn't get alone What it does: Solves the puzzle from the previous statement - explains why less profitable can still be worth it What it is: Author's explanation Visualization: Solo: Can't win Contract A ($0) vs Joint: Win Contract A ($70 profit)

Argument Flow:

The passage starts with an observation about increasing cooperation, then presents a seeming contradiction (lower profits), and finally resolves this contradiction by explaining the strategic advantage

Main Conclusion:

US firms are increasingly cooperating internationally because joint projects help them win foreign contracts they couldn't get alone, even though these projects are less profitable

Logical Structure:

This is an explanatory argument. The author uses a 'problem-solution' structure: presents a trend that seems contradictory (cooperation despite lower profits), then explains why this makes business sense (access to otherwise unavailable contracts)

Prethinking:

Question type:

Misc - This is asking us to identify what information is directly provided in the passage. We need to look for facts that are explicitly stated, not inferred or assumed.

Precision of Claims

The passage makes specific claims about: (1) Activity - transnational cooperation is experiencing a renaissance among US firms, (2) Quality/Quantity - collaborative projects are less profitable than solo projects, (3) Activity - joint projects may allow US firms to win foreign contracts they couldn't win alone

Strategy

For this type of question, we need to identify the key facts that are directly stated in the passage. We're not looking for inferences or conclusions we can draw - just what the author explicitly tells us. We should focus on the three main pieces of information: the trend happening with US companies, the profitability comparison, and the advantage of cooperation.

Answer Choices Explained

Transnational cooperation involves projects too big for a single corporation to handle.

The passage never mentions project size or suggests that these projects are too big for single corporations. The passage only states that joint projects help US firms 'win foreign contracts that they would not otherwise be able to win' - this could be due to many reasons like local partnerships, regulatory requirements, or market access, not necessarily project size.

Transnational cooperation results in a pooling of resources leading to high-quality performance.

The passage makes no mention of resource pooling or quality of performance. In fact, the passage tells us that collaborative projects are 'less profitable than projects undertaken by a single corporation,' which doesn't support the idea of high-quality performance.

Transnational cooperation has in the past been both more common and less common than it is now among United States firms.

This is directly supported by the passage. The phrase 'experiencing a modest renaissance' explicitly indicates that cooperation was once more common (original period), then became less common (decline period), and is now experiencing renewed interest (renaissance period). The word 'renaissance' by definition means a revival of something that previously existed.

Joint projects between United States and foreign corporations are not profitable enough to be worth undertaking.

This contradicts the passage. While the passage states that joint projects are less profitable than solo projects, it clearly indicates they ARE worth undertaking because they allow US firms to win contracts they couldn't get otherwise. The passage is explaining why companies pursue these despite lower profitability.

Joint projects between United States and foreign corporations benefit only those who commission the projects.

The passage doesn't discuss who benefits from these projects or mention anything about those who commission them. The passage focuses on the benefits to US firms participating in the cooperation.

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