XAT 2016 — Decision Making Question 6
Answer the following question based on the information given below.
The City of Yashmund served by licensed taxis operating on officially sanctioned metered rates and driven by licensed drivers who do not own the taxis but pay a monthly rent to the taxi-owners. Shailesh Nair, the mayor of Yashmund, perceived that most of these taxis do not offer sufficient comfort and safety to passengers.
The mayor wants to involve the car owners in finding a solution to the problem of comfort and safety. He is concerned that the customers may not be willing to pay more for safety.
Which of the options below is MOST LIKELY to convince the owners?
Answer & solution
- A
The taxi owners who clear comfort-inspection can charge higher rentals from the drivers and drivers with impeccable safety record can charge the same from customers
- B
The taxis that clear comfort-inspection can charge 25% above the metered rates; studies have shown that customers are willing to pay around 18% extra for comfort.
- C
If a taxis owner has a consistent record of comfort and safety the government will subsidize a second loan.
Taxis can charge 25% more if they clear comfort-inspection. However, owners of the taxis found compromising on safety will be jailed.
- E
Taxis that pass comfort-inspection test can charge 25% more. Should they violate any traffic rule this privilege would be withdrawn.
According to the information provided, the customers may not be willing to pay more for safety which leaves open the possibility of charging more from them for comfort. If the taxi owners are allowed to charge more for comfort, they should be strictly supervised for the safety factor. This way, both the elements of concern of the Mayor are taken care of, along with cooperation from the taxi owners.
Only option 4 resonates this arrangement.
In option 1, safety and comfort are bifurcated into two segments one containing the owner and another containing the taxi driver, whereas the Mayor needs the cooperation of the taxi owners. Hence, eliminate option 1.
Option 2 does not take the safety factor into consideration. So, eliminate option 2.
Option 3 isn't lucrative enough to get the taxi owners on board with the Mayor's offer. So, eliminate option 3.
Option 5 is ambiguous with its mention of traffic rules. So, eliminate option 5.
Hence, the correct answer is option 4.