Garnet Renco- CR

[anoo.anand]

Two computer companies, Garnet and Renco, each pay Salcor to provide health insurance for their employees.Because early treatment of high cholesterol can prevent strokes that would otherwise occur several years later, Salcor encourages Garnet employees to have their cholesterol levels tested and to obtain early treatment for high cholesterol.Renco employees generally remain with Renco only for a few years, however.Therefore, Salcor lacks any financial incentive to provide similar encouragement to Renco employees.

Which of the following, if true, most seriously weakens the argument?

A. Early treatment of high cholesterol does not eliminate the possibility of a stroke later in life.
B. People often obtain early treatment for high cholesterol on their own.
C. Garnet hires a significant number of former employees of Renco.
D. Renco and Garnet have approximately the same number of employees.
E. Renco employees are not, on average, significantly younger than Garnet employees.

[anoo.anand]

why is option E wrong ?

if the employees are young... then .. they wont face any problem related to choletrol...

[mikrodj]

The conclusion is that Salcor lacks any financial incentive to provide similar encouragement to Renco employees.. You should keep the scope of financial incentive in mind.

Option C, which I think is the correct answer choice deals with this problem.

If Garnet hires a significant number of former employees of Renco, then Salcor will have a financial incentive because Garnet employees from Renco will be less likely to suffer strokes.

why is option E wrong ?
if the employees are young... then .. they wont face any problem related to choletrol...

Therefore this strengthens the conclusion that Salcor lacks any financial incentive to provide similar encouragement to Renco employees

[RonPurewal]

The conclusion is that Salcor lacks any financial incentive to provide similar encouragement to Renco employees.. You should keep the scope of financial incentive in mind.

Option C, which I think is the correct answer choice deals with this problem.

If Garnet hires a significant number of former employees of Renco, then Salcor will have a financial incentive because Garnet employees from Renco will be less likely to suffer strokes.

why is option E wrong ?
if the employees are young... then .. they wont face any problem related to choletrol...

Therefore this strengthens the conclusion that Salcor lacks any financial incentive to provide similar encouragement to Renco employees

perfect.

[mikrodj]

Thank you Ron.

[Ben Ku]

Glad it helped.

[akhp77]

Hi MGMAT Staff,

I would like top it.

I could not understand what option C weaken the argument.

If Garnet hires a significant number of former employees of Renco -> why Salcor will have a financial incentive?

I partially understood that once Garnet hires employees of Renco. They become part of Garnet and covered under a better plan (what Garnet's employees were getting ) of Solcor.

Can some elaborate it?

[ranjeet1975]

Garnet recruits significant no. of Renco employees and Renco employees are not treated early for high cholestrol. Then if the high cholestrol results in heart disease at later stage then the insurance company, Salcor, have to pay for it.

And, if Salcor treats Renco employees too for early high cholestrol then after becoming Garnet employees the insurance firm has good advantage.

[RonPurewal]

Garnet recruits significant no. of Renco employees and Renco employees are not treated early for high cholestrol. Then if the high cholestrol results in heart disease at later stage then the insurance company, Salcor, have to pay for it.

And, if Salcor treats Renco employees too for early high cholestrol then after becoming Garnet employees the insurance firm has good advantage.

nicely done.

basically, the principle at work here is future time orientation: by investing the cost of early treatment up front (when these employees are still working at renco), salcor reaps the benefit of not having to pay the increased costs of delayed treatment (when the employees go to work for garnet).

[sandeep.19+man]

Another reason as to why E is wrong

Renco employees are not, on average, significantly younger than Garnet employees.

is NOT equivalent to

Renco employees are, on average, significantly older than Garnet employees. [wrong]

Eg: (E) would hold good if:
Avg age Renco = 34 yrs
Avg age Garnet = 35 yrs

[RonPurewal]

Another reason as to why E is wrong

Renco employees are not, on average, significantly younger than Garnet employees.

is NOT equivalent to

Renco employees are, on average, significantly older than Garnet employees. [wrong]

Eg: (E) would hold good if:
Avg age Renco = 34 yrs
Avg age Garnet = 35 yrs

well, you don't need to dig this deep into the quantitative aspect of choice (e) to figure out that it is wrong.
it's just too distantly related to the passage at hand -- it just deals with an age discrepancy between the employees of the two firms. there's way too much information missing: first of all, there's no indication of the actual age at which these cholesterol problems tend to manifest (if there is even a characteristic age at all), and, second, we do not know whether the employees of either firm are anywhere near that age. from this choice, we only know about the relative difference between their ages, not about whether those ages are anywhere near the threshold at which cholesterol-related conditions start to make a difference.

[manhhiep2509]

Hi Ron.

I do not understand the link between "Renco employees generally remain with Renco only for a few years" and "Salcor lacks any financial incentive".

Does this mean if Renco employees leave the company before they suffer stroke, Salcor will not have to pay for the employees treatment?

Is the link a common knowledge or an inference we could get from the stimulus?

Thank you.

[jlucero]

Hi Ron.

I do not understand the link between "Renco employees generally remain with Renco only for a few years" and "Salcor lacks any financial incentive".

Does this mean if Renco employees leave the company before they suffer stroke, Salcor will not have to pay for the employees treatment?

Is the link a common knowledge or an inference we could get from the stimulus?

Thank you.

This would fall under information given. It says Salcor provides health care for the employees of Garnet and Renco. So if employees no longer work for Garnet or Renco, then Salcor would no longer have to pay for health care.