Logic Breakdown

Passage Summary: Big companies pay managers so much that it's a waste of money to have them watch employees. If the company gives bonuses instead, they can stop the monitoring and save cash.

Conclusion: Highly profitable corporations can achieve cost savings by providing their staff with expensive bonuses.

Reasoning: Because manager time is extremely valuable in profitable firms, monitoring employees is costly; replacing this monitoring with incentives like bonuses can save money if it maintains productivity.

Analysis: The argument relies on a mathematical assumption regarding the trade-off between two different costs. It assumes that the 'expensive bonuses' will actually cost less than the time managers currently spend on supervision. If the bonuses are more expensive than the saved manager hours, the 'savings' disappear entirely. Look for an answer that ensures the cost of the bonuses does not exceed the cost of the monitoring they replace.

Passage Stimulus

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24.

The argument requires the assumption that

Correct Answer
D
D supplies the needed link: expensive bonuses are strong incentives for employees in highly profitable firms where monitoring is reduced. Negating D breaks the chain from reduced monitoring to saving money, so it’s necessary.
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