GMAT Critical Reasoning
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Source: OG
Level: 3
Near Chicago a newly built hydroponic spinach "factuory," a completely controlled environment for growing spinach, produces on 1 acre of floor space what it takes 100 acres of fields to produce. Expenses, especially for electricity, are high ,however, and the spinach produced costs about four times as much as washed California field spinach, the spinach commonly sold throughout the United States.
Which of the following, if true, best supports a projection that the spinach-growing facility near Chicago will be profitable?
- A Once the operators of the facility are experienced, they will be able to cut operating expenses by about 25 percent.
- B There is virtually no scope for any further reduction in the cost per pound for California field spinach.
- C Unlike washed field spinach, the hydroponically grown spinach is untainted by any pesticides or herbicides and thus will sell at exceptionally herbicides an thus will sell at exceptionally high prices to such customers as health food restaurants.
- D Since spinach is a crop that ships relatively well, the market for the hydroponically grown spinach is no more limited to the Chicago area than the market for California field spinach is to California.
- E A second hydroponics facility is being built in Canada, taking advantage of inexpensive electricity and high vegetable prices.