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Shareholder: The company’s current operations are time-proven successes. The move into food services may siphon off funds needed by these other operations. Also, the food service industry is volatile, with a higher inherent risk than with, for instance, pharmaceuticals, another area into which the company has considered expanding.
If the shareholder’s statements are true, which one of the following is most strongly supported by them?
  • a)
    The company’s present operations require increased funding.
  • b)
    Investment into pharmaceuticals would not siphon off money from other operations.
  • c)
    The company will lose money as it expands into the food service industry.
  • d)
    Only if the company expands its operations into pharmaceuticals are increased profits possible.
  • e)
    The company has a greater chance of losing money in food services than in pharmaceuticals.
Correct answer is option 'E'. Can you explain this answer?
Most Upvoted Answer
Shareholder: The company’s current operations are time-proven su...
(A) The company’s present operations require increased funding.
This option is not directly supported by the shareholder's statements. While the shareholder mentions that funds may be diverted from the company's current operations, it does not explicitly state that increased funding is necessary for those operations.
(B) Investment into pharmaceuticals would not siphon off money from other operations.
The shareholder's statements do not directly address the potential impact of investing in pharmaceuticals on other operations. Therefore, this option is not strongly supported by the statements.
(C) The company will lose money as it expands into the food service industry.
This option aligns with the shareholder's concerns about the higher inherent risk and volatility of the food service industry. The shareholder suggests that investing in food services may siphon off funds needed by other operations. Although it does not explicitly state that the company will lose money, the concern about diverting funds implies a potential negative impact on the company's financial performance.
(D) Only if the company expands its operations into pharmaceuticals are increased profits possible.
The shareholder's statements do not directly support this option. While the shareholder mentions pharmaceuticals as an area the company has considered expanding into, it does not make any statements about increased profits being possible only through this expansion.
(E) The company has a greater chance of losing money in food services than in pharmaceuticals.
This option is strongly supported by the shareholder's statements. The shareholder explicitly mentions that the food service industry is volatile and carries higher inherent risk compared to pharmaceuticals. This suggests that the company is more likely to face financial losses in food services than in pharmaceuticals if it decides to expand into both areas.
Based on the provided information, option (E) is the statement most strongly supported by the shareholder's statements.
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Shareholder: The company’s current operations are time-proven successes. The move into food services may siphon off funds needed by these other operations. Also, the food service industry is volatile, with a higher inherent risk than with, for instance, pharmaceuticals, another area into which the company has considered expanding.If the shareholder’s statements are true, which one of the following is most strongly supported by them?a)The company’s present operations require increased funding.b)Investment into pharmaceuticals would not siphon off money from other operations.c)The company will lose money as it expands into the food service industry.d)Only if the company expands its operations into pharmaceuticals are increased profits possible.e)The company has a greater chance of losing money in food services than in pharmaceuticals.Correct answer is option 'E'. Can you explain this answer?
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Shareholder: The company’s current operations are time-proven successes. The move into food services may siphon off funds needed by these other operations. Also, the food service industry is volatile, with a higher inherent risk than with, for instance, pharmaceuticals, another area into which the company has considered expanding.If the shareholder’s statements are true, which one of the following is most strongly supported by them?a)The company’s present operations require increased funding.b)Investment into pharmaceuticals would not siphon off money from other operations.c)The company will lose money as it expands into the food service industry.d)Only if the company expands its operations into pharmaceuticals are increased profits possible.e)The company has a greater chance of losing money in food services than in pharmaceuticals.Correct answer is option 'E'. Can you explain this answer? for GMAT 2025 is part of GMAT preparation. The Question and answers have been prepared according to the GMAT exam syllabus. Information about Shareholder: The company’s current operations are time-proven successes. The move into food services may siphon off funds needed by these other operations. Also, the food service industry is volatile, with a higher inherent risk than with, for instance, pharmaceuticals, another area into which the company has considered expanding.If the shareholder’s statements are true, which one of the following is most strongly supported by them?a)The company’s present operations require increased funding.b)Investment into pharmaceuticals would not siphon off money from other operations.c)The company will lose money as it expands into the food service industry.d)Only if the company expands its operations into pharmaceuticals are increased profits possible.e)The company has a greater chance of losing money in food services than in pharmaceuticals.Correct answer is option 'E'. Can you explain this answer? covers all topics & solutions for GMAT 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Shareholder: The company’s current operations are time-proven successes. The move into food services may siphon off funds needed by these other operations. Also, the food service industry is volatile, with a higher inherent risk than with, for instance, pharmaceuticals, another area into which the company has considered expanding.If the shareholder’s statements are true, which one of the following is most strongly supported by them?a)The company’s present operations require increased funding.b)Investment into pharmaceuticals would not siphon off money from other operations.c)The company will lose money as it expands into the food service industry.d)Only if the company expands its operations into pharmaceuticals are increased profits possible.e)The company has a greater chance of losing money in food services than in pharmaceuticals.Correct answer is option 'E'. Can you explain this answer?.
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