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Question
Suncorp, a new corporation with limited funds has been clearing large sections of the tropical Amazon forest for cattle ranching. This practice continues even though greater profits can be made from rubber tapping which does not destroy the forest than from cattle ranching which does destroy the forest.
Which of the following if true most helps to explain why Suncorp has been pursuing the less profitable of the two economic activities mentioned above?
Suncorp, a new corporation with limited funds has been clearing large sections of the tropical Amazon forest for cattle ranching. This practice continues even though greater profits can be made from rubber tapping which does not destroy the forest than from cattle ranching which does destroy the forest.
Which of the following if true most helps to explain why Suncorp has been pursuing the less profitable of the two economic activities mentioned above?
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Solution
The correct option is E The amount of money required to begin a rubber-tapping operation is twice as high as the amount needed to begin a cattle ranch
Let's go through the options here to find out the correct answer. Option A does not add anything to the question that would help us decide why Suncorp has been pursuing the less profitable of the two economic activities- it describes the quality of the soil of the Amazon forest, which is not directly related to the question. This just means that the soil is equally good for rubber plants. A is thus incorrect. Option B too doesn't fit the context as climatic conditions haven't been taken to consideration in the first place. C actually states the opposite of the required answer. Option D is completely irrelevant as regards the context asked. It is only option E that fits the context because a new venture has limited funds and as in comparison cattle ranching requires less capital,it is the preferable venture.
Let's go through the options here to find out the correct answer. Option A does not add anything to the question that would help us decide why Suncorp has been pursuing the less profitable of the two economic activities- it describes the quality of the soil of the Amazon forest, which is not directly related to the question. This just means that the soil is equally good for rubber plants. A is thus incorrect. Option B too doesn't fit the context as climatic conditions haven't been taken to consideration in the first place. C actually states the opposite of the required answer. Option D is completely irrelevant as regards the context asked. It is only option E that fits the context because a new venture has limited funds and as in comparison cattle ranching requires less capital,it is the preferable venture.
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