#11- Businesses frequently use customer surveys in an

[Administrator]

Complete Question Explanation

Resolve the Paradox. The correct answer choice is (C)

This stimulus presents a surprising situation involving the use of customer surveys by businesses.
Apparently, businesses often use surveys as part of their effort to improve sales and increase profits.
Yet despite the fact that businesses frequently turn to surveys for these purposes, the results of a
recent study indicate that most of the businesses that used surveys saw their profits decline during the
course of the study. On the other hand, most of the businesses that did not use the surveys did not see
their profits decline. And this is true even though the companies being tracked sold similar products.

The question stem tells us to select the answer choice that best explains this result. This is a Resolve
the Paradox question. Our prephrase is that the situation described in the stimulus is only confusing
if we apply improper causal reasoning. All we know from the stimulus is that there is a correlation
between the use of surveys and the decline in profits. However, we don’t know which of those
correlated items occurred first. Perhaps it is an existing drop in profits that causes companies to turn
to surveys in an effort to fix the problem. If so, the situation is no longer surprising.

Answer choice (A): This answer choice explains why some companies would experience an increase
in profits while competing companies would see a decrease in profits. However, it does not explain
how the use of surveys factors into the difference in profits.

Answer choice (B): Here, the answer choice supports the idea that some companies regularly use
surveys. However, it does not explain the difference in profits experienced by those companies which
use customer surveys and those which do not.

Answer choice (C): This is the correct answer choice, because it tells us that most of the
businesses of the kind studied only turn to customer surveys when there is a problem with that
particular company’s performance. So, it may be the case that the companies’ profits did not decline
as a result of their using surveys. Instead, they began to use surveys because their profits were
declining.

Answer choice (D): This answer choice tells us that we cannot necessarily trust survey results, but it
does not explain the difference in profits.

Answer choice (E): In this case, the answer choice tells us that the surveys did not accomplish
anything for some of the companies because those companies did not analyze the results of the
surveys they conducted. However, we do not know which companies did not analyze the results, so
this answer choice does not help to resolve the paradox.

[mpoulson]

Hello,

I originally chose answer D thinking that if the survey was improperly filled out the implementation of the wrong information might affect the profits of the business. However, this was wrong. Can you explain why the answer was C? I also thought A could of been a valid choice. However, this is also wrong. My question what makes C most appropriate versus A and D. Thank you.

- Micah

[Clay Cooper]

Hi Micah,

Thanks for your question.

Answer choice C is correct because it explains how businesses who use surveys (which typically work) might still have worse profits than their competitors who don't; it tells us that these surveys are usually used when the business using them has received complaints. If that is true, it explains both pieces of conflicting information - if complaints are coming in, we might use surveys and still lose profits compared to competing businesses whose customers are too pleased with the product to complain.

Answer choice A doesn't offer us any information about why one company in particular experiences profit growth; it only addresses the profit side of the paradox, and thus is incomplete.

Answer choice D suggests that maybe the surveys are in fact useless, but doesn't provide any alternative explanation for why companies that use them consistently lose profit compared to their competitors.

I hope that helps!

[eronquillo12]

Hi- I also chose D. Is it wrong bc it is bringing in outside information to assume that the businesses might have used the inaccurate survey results (not knowing they were inaccurate) to improve sales/increase profits? I am not quite certain why D is wrong.

[Jennifer Janowsky]

eronquillo12,

The problem of (D) is not the use of outside information, as the question asks which "if true" would explain decline in profits. Therefore, you are to assume the truth of the information. However, if you do take to be true that customers fill out surveys untruthfully, the results of these surveys are still not relevant to the stimulus--only whether or not they administer these surveys, and their businesses' profits.

(C) is correct, because if businesses generally create surveys as response to customer dissatisfaction, it would not be surprising if their profits were declining also. This links profit and the creation of surveys.

Hope this helps!

[eronquillo12]

Hi Jennifer- thank you, this does help!

[kcho10]

Complete Question Explanation

Resolve the Paradox. The correct answer choice is (C)

This stimulus presents a surprising situation involving the use of customer surveys by businesses.
Apparently, businesses often use surveys as part of their effort to improve sales and increase profits.
Yet despite the fact that businesses frequently turn to surveys for these purposes, the results of a
recent study indicate that most of the businesses that used surveys saw their profits decline during the
course of the study. On the other hand, most of the businesses that did not use the surveys did not see
their profits decline. And this is true even though the companies being tracked sold similar products.

The question stem tells us to select the answer choice that best explains this result. This is a Resolve
the Paradox question. Our prephrase is that the situation described in the stimulus is only confusing
if we apply improper causal reasoning. All we know from the stimulus is that there is a correlation
between the use of surveys and the decline in profits. However, we don’t know which of those
correlated items occurred first. Perhaps it is an existing drop in profits that causes companies to turn
to surveys in an effort to fix the problem. If so, the situation is no longer surprising.

Answer choice (A): This answer choice explains why some companies would experience an increase
in profits while competing companies would see a decrease in profits. However, it does not explain
how the use of surveys factors into the difference in profits.

Answer choice (B): Here, the answer choice supports the idea that some companies regularly use
surveys. However, it does not explain the difference in profits experienced by those companies which
use customer surveys and those which do not.

Answer choice (C): This is the correct answer choice, because it tells us that most of the
businesses of the kind studied only turn to customer surveys when there is a problem with that
particular company’s performance. So, it may be the case that the companies’ profits did not decline
as a result of their using surveys. Instead, they began to use surveys because their profits were
declining.

Answer choice (D): This answer choice tells us that we cannot necessarily trust survey results, but it
does not explain the difference in profits.

Answer choice (E): In this case, the answer choice tells us that the surveys did not accomplish
anything for some of the companies because those companies did not analyze the results of the
surveys they conducted. However, we do not know which companies did not analyze the results, so
this answer choice does not help to resolve the paradox.

I still don't understand why C is correct. Regardless of why the surveys were put in place, shouldn't we expect to see an increase in profits rather than a decline based on the passage?

[Alex Bodaken]

kcho10,

Thanks for the question! A couple of key things here: first, we don't actually know that surveys increase profits, we only know (from the first sentence) that businesses use them in an attempt to increase sales and profits. So we don't know that they work. Second, the phrase "during the course of the study" is really important: it lets us know that this conclusion is derived from data collected while the surveys were being used (not after). So even if, for instance, surveys could increase profits later as businesses used them to improve the products, that wouldn't factor in here as we are only talking about sales and profits while the surveys are being given. In the end, answer choice (C) ends up being credited because it gives us a reason that the sales and profits of businesses using the surveys might decline more than other businesses: because these surveys are correlated with problems (specifically customer complaints) that make profitability less likely.

Hope that helps!
Alex

[chian9010]

Hi,

i am sill not quit sure why D is incorrect while why C is correct.

Answer choice C:
For me, if businesses only treated survey as complaints from customer, this doesn't explain why the profits of other businesses, which didn't take the customer survey, was not declined

While for answer choice D:
If customers who completed the survey didn't always provide correct answers, then this could mislead business, who reviewed the surveys seriously, changing business strategy into wrong direction and resulted in profit decline. This also perfectly explains why the other businesses who didn't take the survey were not affected/misleaded by the wrong information provided by the customers

I would appreciate if anyone could provide further info on answer choice C.

[Jay Donnell]

Hi Chian!

I think the issue behind your confusion regarding D stems mainly from an equivocation in terms.

D says that "Customers who complete surveys do not always respond accurately to all the questions on the survey."

The lack of accuracy on all of the questions is not equivalent in meaning to the customers providing incorrect answers. I can see a lightly implied line of reasoning that if they had given incorrect or misleading answers, business could then react by implementing ill-advised changes which become detrimental financially, but that takes a fairly big assumptive jump to see that as the answer that 'most helps to explain' the paradox.

C provides a much better answer in that it helps account for why the businesses that offer surveys are losing profits and those who don't offer surveys are not. C implies a possible reversal in causality that suggests that it's not the customer surveys (designed to improve sales and increase profits) that are hurting business, but rather that the declining business was the impetus for the surveys in the first place.

The fact that the business who are not offering surveys are not losing profits isn't what needs to be explained, as a company that is not changing their business is totally consistent with their profits remaining unchanged. The paradox was primarily in regard to why the businesses that offered the surveys were found to lose profits, and C offers the best ability to reconcile that situation.

Hope that helps!