Refer to the data.
Mr. Rightsize has the option of investing his severance pay in the shares of one out of four companies available. A positive investment decision is based on four parameters: good management, price of the company's shares (cheaper the better), attractiveness of the industry in which the company operates, and good future growth prospects. Details of the four companies are:
1] Cooch Behar Railroads has a good management, but the industry in which it operate; is not attractive and has limited growth prospects. The company's shares could possibly appear cheap.
2] Alliance Petro also has a good management and the company's shares are cheap. However, the industry in which it operates may possibly not be attractive and definitely has limited growth prospects.
3] eZoooom! is a hot Internet company with a good management. The industry could possibly be attractive, the growth prospects could possibly be good and its shares could possibly appear expensive.
4] BioSync is an attractive industry and the company's shares are certainly expensive. However, either the management is not up to the mark or the company's growth prospects are limited, but not both.
The limited size of the severance pay restricts the possible investment to just one company.
If atleast two parameters need to be positive (of which good management is one) for a positive investment decision, then Rightsize may possibly not invest in:

eZoooom! only.

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Cooch Behar Railroads and BioSync only.

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BioSync only.

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Cooch Behar Railroads, eZoooom! and BioSync only.

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None of these.

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Solution

The correct option is E None of these.
With two positive parameters (including good management) required, the only company definitely fitting the bill is Alliance Petro.

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Q. Company X is facing a lot of problems these days. It manufactures white goods like washing machines, microwave ovens, refrigerators and air conditioners. The company’s margins are under pressure and the profits and market share are declining. The production department blames marketing for not meeting sales targets and marketing blames production department for producing goods, which are not of good quality meeting customers expectations. The finance department blames both production and marketing for declining return on investment and bad marketing.

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Company X is facing a lot of problems these days. It manufactures white goods like washing machines, microwaves, refrigerators, and air conditioners. The company's margins are under pressure and the profits and market share are declining. The production department blames the marketing department for not meeting sales targets and marketing blames production department for producing goods, which are neither of good quality nor meeting, customers expectations. The finance department blames both the production and the marketing department for a declining return on investment and bad marketing.
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The correct option is E None of these.With two positive parameters (including good management) required, the only company definitely fitting the bill is Alliance Petro.

The correct option is E None of these.
With two positive parameters (including good management) required, the only company definitely fitting the bill is Alliance Petro.