XAT 2016 — Decision Making Question 1
Answer the following question based on the information given below.
Kamal Chinnappa, Vimal Rao, Ganesh Krishnan and Dines Kumar own a saloon each on the Barbil street. They are the only hairdressers on that street. Each of them offered three services viz. haircut, shaving and hair-dye. One evening, all four of them met in a nearby tea-stall and agreed to charge Rs. 100 for any of the three services (haircut, shave and hair-dye) on weekdays. They also agreed to increase this rate to Rs. 115 on weekends and holidays. All verbally decided to implement the agreement.
The following day Kamal, being the most competent hairdresser on the street, was contemplating charging higher than agreed upon price.
Which of the following would enable him to charge more with minimal violation of the agreement?
Answer & solution
He should introduce a new and specialized service at Rs. 130.
- B
He should open another shop on the same street and charge Rs. 150.
- C
He should charge Rs. 130 for those wanting to jump the queue.
- D
He should charge Rs. 115 for a service to a particular customer and give the next service free.
- E
He should open his shop two hours before others and close it two hours after.
This move will break the agreement to a larger extent and can be eliminated.
This move would be unfair for other customers and also by charging Rs130 Kamal would be violating the agreement. So, eliminate option 3.
This move will lead to violation of the agreement as Kamal cannot charge more than Rs 100 for agreed upon services as part of the contract. So, eliminate option 4.
Flexible shop timings does not ensure greater profits and thus this option can be eliminated.
Option 1 is the best option as introducing a new service would be a minimal violation as the other hairdressers were providing only three services and charging Rs 130 for that service would not cause any violation as Rs 100 charge pertained to those three services only.
Hence, the correct answer is option 1.