LSAT 127 – Section 3 – Question 08

LSAT 127 - Section 3 - Question 08

December 2003

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Question QuickView	Type	Tags	Answer Choices	Curve	Question Difficulty	Psg/Game/S Difficulty	Explanation
PT127 S3 Q08	+LR	Strengthen +Streng Eliminating Options +ElimOpt	A 93% 165 B 0% 155 C 0% 149 D 6% 157 E 0% 150	129 138 148	+Easier	146.462 +SubsectionMedium

Economist: During a recession, a company can cut personnel costs either by laying off some employees without reducing the wages of remaining employees or by reducing the wages of all employees without laying off anyone. Both damage morale, but layoffs damage it less, since the aggrieved have, after all, left. Thus, when companies must reduce personnel costs during recessions, they are likely to lay off employees.

Summarize Argument

The economist concludes that companies are likely to lay off employees during recessions. This is because layoffs affect morale less than wage reductions.

Notable Assumptions

The economist believes that companies will undertake the action that affects morale the least in a recession. This means the economist assumes other considerations simply aren’t as important to companies, including financial considerations—the economist never claims that layoffs and wage reductions are equally cost-efficient.

Employee morale is usually the primary concern driving companies’ decisions about whether to lay off employees or to reduce their wages.

Companies indeed do decide mainly based on morale. This strengthens the economist’s argument that companies will go with the option that’s best for morale.

In general, companies increase wages only when they are unable to find enough qualified employees.

Wage increases aren’t on the table here.

Some companies will be unable to make a profit during recessions no matter how much they reduce personnel costs.

We don’t care whether they’ll make a profit. We’re interested in how they’ll reduce costs.

When companies cut personnel costs during recessions by reducing wages, some employees usually resign.

We have no idea if this would be a good thing or a bad thing for a company. Thus, this could be a strengthener or a weakener. We don’t want to assume which one it is.

Some companies that have laid off employees during recessions have had difficulty finding enough qualified employees once economic growth resumed.

This seems to weaken the economist’s argument. We’re trying to do the opposite.

LSAT 127 – Section 3 – Question 08

LSAT 127 - Section 3 - Question 08

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Review Results

LSAT PrepTest 127 Explanations

Section 1 - Logical Reasoning

Section 2 - Logical Reasoning

Section 3 - Logical Reasoning

Section 4 - Reading Comprehension

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