XAT 2023 Question Paper | Bussiness Decision Making

CAT Questions

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Read the following scenario and answer the THREE questions that follow.

Dhan, a poor but enterprising 15-year-old, resided in the world’s largest slum in a metropolitan city, along with her widowed mother. The densely packed slum housed about a million people, mostly in rickety one room tenements, connected by labyrinthine lanes and by-lanes. Dhan’s mother worked intermittently as a daily wager in a small savoury factory. For a 15-year-old, Dhan’s life was hectic. She spends two hours every day in fetching water for the household, packing breakfast and lunch for her mother. In addition, she had to prepare supper. On her mother’s insistence, Dhan also attended an evening bridge school run by an NGO. Dhan’s dream was to provide a comfortable life to her mother and take her family out of poverty. Of late, Dhan observed that the customers to a nearby tea-cum-savoury stall (TCS), were mostly the slum dwellers, who thronged the stall for its low prices and lack of alternatives. Further, Dhan gathered that the TCS could not cater to all of its customers, and the owner still made a neat Rs.800 profit per day. Dhan saw that a probable first step towards her family’s economic independence could be to own her own TCS.

Question 22 : Dhan with her ingenuity finds a way to scale up her production capacity on her own terms. Though Dhan’s TCS has become the famous “Dhan Dhana Dhan” brand within the slum, it is still unknown to the outside world. Thus, Dhan embarks on the next challenge of creating a market for savouries amongst the masses in the metropolitan region.

From the following, choose the BEST option that will help Dhan to sell her products, at the lowest price, to a maximum number of metropolitan customers?

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Video Explanation

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Explanatory Answer

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The question is " Within two years of establishment, Dhan’s TCS is not only outcompeting its nearest rivals in the slum but has also earned a goodwill for the quality and taste of its products. Hence, it has become famous within the slum as “Dhan Dhana Dhan” brand. Dhan now aspires to expand the reach of her savouries into the metropolitan region. Dhan wishes to scale up her savoury production from 100 kg to 1000 kg per day while maintaining quality. Dhan realizes that her establishment does not have the space for expansion on its own.

Which of the following options will BEST help Dhan to scale up production with least investment, tightly control quality, and also protect her business interests?"

Hence, the answer is 'Engage slum dwellers commuting daily to metropolitan region for work, to sell the products on commission basis'

Choice D is the correct answer.

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