Instructions

Answer questions on the basis of information given in the following case.

A few years back Mr. Arbit and Mr. Boring started an oil refinery business. Their annual earing is currently just 50,000 million rupees. They are now exploring various options to improve the business. Mr. Xanadu, a salesperson from Innovative Technology Solutions (ITS), is trying to sell a new oil refinery technology to Mr. Arbit and Mr. Boring. This technology could potentially enhance their annual earning to 150,000 million rupees within a year. But they have to make one - time investment of 100,000 million rupees to implement the technology. If the technology is not successful, the investment would be lost. Mr. Arbit and Mr. Boring are discussing about possible risks of the investment.

Question 39

Mr. Arbit is enthusiastic about this investment idea but Mr. Boring is a little sceptical. This impasse makes them approach a consultant. The consultant makes some observations. Which of the following observations, made by the consultant, might reduce Mr. Arbit’s enthusiasm for the new investment idea?

Solution

Options B and C increase the enthusiasm. Options D and E neither increases nor decrease the enthusiasm. Among the given options, option A is the appropriate one. Option A to some extent will decrease the enthusiasm of Mr. Arbit.

The answer is option A.

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