A global telecommunications company, in its 2022 annual report, revealed that three of its four divisions turned a profit, a significant improvement from the previous year when only the Asian division reported positive earnings. The Chief Executive Officer attributed this success to a new initiative focused on enhancing customer service in previously neglected regions.

Which of the following, if true, would most seriously undermine the CEO's claim regarding the reasons for the company's improved financial results?

Answer Choices

Correct answer marked below

The telecommunications company launched several new customer service centers in previously neglected regions last year.

The company's established markets did not show any significant changes in revenue or expenses.

The finance department implemented a new accounting standard that recognizes revenue from transactions that would have been recorded in the next fiscal year.

Correct

There will be fewer job cuts in the underperforming divisions due to a new labor agreement that allows the company to lower salaries by fifteen percent to ease financial pressures.

Three years ago, all four divisions of the company achieved or surpassed the average profit margins of the top fifty telecommunications firms.

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Explanation

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Official Explanation

Official

To determine which statement most seriously undermines the CEO's claim, we need to analyze the options. The CEO claims that the improved financial performance is due to the new initiative in customer service. If the finance department's new accounting standard allows for earlier recognition of…

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Comments

ArkaJan 5, 2025

thanks for the answer

NelseeApr 7, 2025

how much time should this take to solve?

KaiJun 9, 2024

Can someone explain it other way?

ElleJan 26, 2025

thanks a lot

What this question tests

What it tests

Whether you can identify the option that most undermines an argument's conclusion.

Common trap

Choosing an irrelevant objection or one that attacks the premise rather than the reasoning.