The document presents an argument that Shelby Industries should lower employee wages to gain a competitive advantage over Jones Industries since wages account for 40% of manufacturing costs at both companies. This argument is weakened if lowering wages would reduce employee work quality and lead to lowered sales.

1. Critical Reasoning
CAT-VARC

2. • Which of the following most logically completes the passage?
For the past several years, a certain technology has been widely used to transmit data among networked
computers. Recently two data transmission companies, Aptron and Gammatech, have each developed separate
systems that allow network data transmission at rates ten times faster than the current technology allows.
Although the systems are similarly priced and are equally easy to use, Aptron's product is likely to dominate the
market, because __________.
(A) Gamma tech has been in the business of designing data transmission systems for several years more than
Aptron has.
(B) the number of small businesses that need computer networking systems is likely to double over the next
few years.
(C) it is much more likely that Gammatech's system will be expandable to meet future needs
(D) unlike many data transmission companies, Aptron and Gammatech develop computers in addition to data
transmission systems
(E) it is easier for users of the current data transmission technology to switch to Aptron's product than to
Gammatech's

3. Platinum is a relatively rare metal vital to a wide variety of industries. Xagor Corporation, a
major producer of platinum, has its production plant in a country that will soon begin
imposing an export tax on platinum sold and shipped to customers abroad. As a
consequence, the price of platinum on the world market is bound to rise.
Which of the following, if true, tends to confirm the conclusion above?
A. An inexpensive substitute for platinum has been developed and will be available to
industry for the first time this month.
B. The largest of the industries that depend on platinum reported a drop in sales last
month.
C. The producers of platinum in other countries taken together cannot supply enough
platinum to meet worldwide demand.
D. Xagor produced more platinum last month than in any previous month.
E. New deposits of platinum have been found in the country in which Xagor has its
production plant.

4. Working professionals aged between 35 and 45 are more likely to purchase the
latest gadgets and are more likely to purchase it in larger numbers than are
teenagers or young adults. Therefore the popular belief that teenagers and
young adults spend more time with smart-phones, tablets, and other gadgets
must be false.
The argument is flawed primarily because the author
(A) Does not specify the precise number of gadgets purchased by any
demographic group.
(B) Discusses gadgets rather than more widely utilized tools.
(C) It depends on popular belief rather than on documented research findings.
(D) Fails to distinguish between “purchasing” and “spending time with”.
(E) Does not supply information about working professionals aged 35 to 45.

5. Most young employees move quickly from one company to the next, changing jobs up to three times in a
year. However, Happy Snax is known for retaining young workers for well over a year. Happy Snax claims its
retention rate is due to the fact that they do not require uniforms or formal break times.
Which of the following, if true, most strengthens Happy Snax explanation of its success in retaining young
employees?
A) Young employees often change jobs because they become bored with their current job and are looking
for something new and exciting
B) Many young employees at Happy Snax have not had a job previously
C) Young employees find uniforms and formal schedules unappealing
D) Uniforms and formal schedules lead to more productivity in the workplace
E) Happy Snax also provides free housing to all of its young employees for the first year

6. Many breakfast cereals are fortified with vitamin supplements. Some of these cereals provide 100 percent of
the recommended daily requirement of vitamins. Nevertheless, a well-balanced breakfast, including a variety of
foods, is a better source of those vitamins than are such fortified breakfast cereals alone.
Which of the following, if true, would most strongly support the position above?
(A) In many foods, the natural combination of vitamins with other nutrients makes those vitamins more usable
by the body than are vitamins added in vitamin supplements.
(B) People who regularly eat cereals fortified with vitamin supplements sometimes neglect to eat the foods in
which the vitamins occur naturally.
(C) Foods often must be fortified with vitamin supplements because naturally occurring vitamins are removed
during processing.
(D) Unprocessed cereals are naturally high in several of the vitamins that are usually added to fortified
breakfast cereals.
(E) Cereals containing vitamin supplements are no harder to digest than similar cereals without added vitamins.

7. In the United States profits from sales of Grainco’s biggest selling product, cornflakes, have dropped by 30
percent over the last 3 years. During this same time the value of a share of Grainco stock rose by over 20
percent. This is puzzling because the value of a stock usually decreases when a company’s sales decrease.
Which of the following, if true during the last 3 years, most helps to explain why the value of a share of
Grainco stock moved in the way that it did?
(A) Severe drought in the Midwest destroyed a large percentage of the corn crop, forcing Grainco to buy less
corn.
(B) Grainco closed a food processing plant in a locality that offered cheap labor and low taxes.
(C) Profits from sales of Grainco oatmeal, which account for a large part of Grainco’s total sales and profits,
increased dramatically in both the foreign and domestic markets.
(D) Grainco employees formed a union that helped them get higher salaries and increased medical benefits.
(E) Several articles in prominent business publications listed Grainco as a company that has poor management.

8. • Phytonutrients, found in fresh fruits and vegetables, has beneficial effects on the human cardiovascular
system. Because heart disease is a major health concern, American doctors should encourage all people,
especially those with heart disease, to eat a diet high in fresh fruits and vegetables.
Which of the following, if true, provides the most support for the argument above?
(A) the combination of soluble and insoluble fibers found in whole grains also support heart health
(B) a large percentage of those who suffer heart disease in the United States do not live close to large
agricultural area where fruits and vegetables are grown
(C) smoking cigarettes is a much more serious health risk than the lack of fresh fruits and vegetables in one's
diet
(D) vegetarians tend to live longer than folks in the general population
(E) folks with heart disease who eat few or no fresh fruits and vegetables have heart attacks at a much higher
rate than do the folks who eat those foods.

9. • The average age of residents in Sunset City is well over 70 years of age, and the populace is composed
almost entirely of retirees, with extremely few families having young children. However, Sunset City is also
known for its many boutiques that specialize in selling clothing for infants and toddlers.
Which of the following, if true, best reconciles the seeming discrepancy described above?
A.The children's clothing boutiques in Sunset City purchase their clothing from wholesalers in Sunrise City,
where there are many more families with small children.
B.The few children who do live in Sunset City do not have particularly large wardrobes.
C.The residents of Sunset City are known to spend more on health care than do residents of nearby cities.
D.The residents of Sunset City are generally wealthy and are known to spend large amounts of money buying
gifts for their grandchildren and great-grandchildren who live in other cities.
E.Sunset City is not located on a major highway.

10. Shelby Industries manufactures and sells the same gauges as Jones Industries. Employee wages account for forty
percent of the cost of manufacturing gauges at both Shelby Industries and Jones Industries. Shelby Industries is
seeking a competitive advantage over Jones Industries. Therefore, to promote this end, Shelby Industries should
lower employee wages.
Which of the following, if true, would most weaken the argument above?
(A) Because they make a small number of precision instruments, gauge manufacturers cannot receive volume
discounts on raw materials.
(B) Lowering wages would reduce the quality of employee work, and this reduced quality would lead to lowered
sales.
(C) Jones Industries has taken away twenty percent of Shelby Industries' business over the last year.
(D) Shelby Industries pays its employees, on average, ten percent more than does Jones Industries.
(E) Many people who work for manufacturing plants live in areas in which the manufacturing plant they work for is
the only industry.