Comprehension
Read the following scenario and answer the questions that follow.
Kasta, a small industrial town hosted a steel plant and its associated ancillary companies. Most of its residents were steel plant employees from different states of the country. While the town offered employment opportunities, it lacked an airport. For those wanting to fly, the nearest airport was in Michaelganj, 100 kms from Kasta. To reach the airport, people rented taxi services available at Kasta, and Prabhu was one such taxi-service provider.
Prabhu’s rates were reasonable - a trip to airport cost Rs. 2200, but for a round trip, the fare was Rs. 3000. Yet, it was not just the affordability that made him popular, his reputation for punctuality and reliability was unmatched. When it came to ensuring the safety of women travelling alone, he would always be the first choice. Such was his trustworthiness that even the steel plant would solicit his services when expecting solo female visitors. Moreover, whenever residents encountered issues with their personal cars, they would turn to Prabhu for help.
However, the world shifted when the COVID-19 pandemic struck. Travel restrictions and safety concerns limited Prabhu’s trips to Michaelganj for over a year and a half. Financial strain followed, with accumulating interest on his home loan. He was weighed down by debt, but things improved once COVID-19 travel restrictions were lifted. Having faced financial hardships during COVID-19, he sought to offset his losses by raising the fare. Yet, he was aware of the stiff competition in town, where many others offered services at a similar fare as his.
Question: 1

Prabhu decided to increase the taxi fare for all future trips. He planned to charge Rs. 3000 for a one-way trip to the airport, and Rs. 1000 more for a round trip.
Which of the following facts will BEST help Prabhu’s regular customers in accepting the increase in fare?

Updated On: Jan 13, 2026
  • Because, the cost of living has gone up in Kasta.
  • Because, Prabhu is punctual and reliable.
  • Because, Prabhu is facing financial hardships.
  • Because, Prabhu offers repair services to residents’ car-related issues.
  • Because, Prabhu serves many top officials of the steel plant.
Show Solution

The Correct Option is B

Solution and Explanation

Phase 1: Define Prabhu's distinct value.
Prabhu is favored by clients due to his consistent timeliness and dependability.
Phase 2: Assess client viewpoint.
Loyal patrons prioritize dependability and trust over price. Prabhu's financial difficulties are of little direct concern to clients; however, the caliber of his services is paramount.
Phase 3: Examine alternatives.
- Alternative 1: Broad price adjustments may not validate a targeted fare increase.
- Alternative 2: Highlighting punctuality and reliability fosters client assurance in his service.
- Alternative 3: Clients are unlikely to sympathize with personal financial difficulties.
- Alternative 4: Repair services have no bearing on taxi fares.
- Alternative 5: Serving high-ranking officials is unrelated to fare adjustments.
Conclusion: (2)

Was this answer helpful?
0
Question: 2

After Prabhu increased his charges by 30%, the revenue flow was promising in the beginning, especially from the steel plant’s official trips. After a few months, he noticed a dip in private bookings. On exploring further, Prabhu realized that while women travelling solo still preferred Prabhu’s service, some of his regular customers were choosing his competitors when travelling as a family. However, he knew that his competitors, while charging lower than him, were still tardy and sometimes cancelled at the last minute.
Which of the following options will BEST help Prabhu to retain his revenue flow?

Updated On: Jan 13, 2026
  • Revert the pricing of services to its prior rate.
  • Give 50% discount for personal trips.
  • Stick to his current increased charges.
  • Charge a premium when women travel solo.
  • Charge a premium for the steel plant’s official trips
Show Solution

The Correct Option is C

Solution and Explanation

Step 1: Identify the issue.
A decline in private bookings suggests Prabhu's increased prices are deterring families and individual clients.
Step 2: Evaluate customer behavior.
Individual customers prioritize cost. Implementing personal trip discounts can attract this demographic while maintaining current pricing for other groups.
Step 3: Assess options.
- Option 1: Reverting prices could indicate strategic instability.
- Option 2: Discounts can be targeted at individual customers to counter the booking drop.
- Option 3: Maintaining current charges will not resolve the revenue shortfall.
- Option 4: A premium for female travelers might alienate a dedicated customer base.
- Option 5: Steel plant trips are stable and likely require no price modification.
Final Answer: (2)

Was this answer helpful?
0
Question: 3

Saroj, the new Chief Financial Officer (CFO) at the steel plant, used the services of Manoj when he first travelled from the Michaelganj airport to the plant. Manoj was a rival of Prabhu in the taxi service business at Kasta. Manoj, upon learning that Saroj would be responsible for hiring taxi services for the steel plant, charged Saroj only Rs. 1500 for that trip. Further, he assured Saroj to charge the same for a one way-trip and additional Rs. 500 for a round trip to the airport.
Upon realizing that the plant utilized Prabhu’s services for all official trips to the airport, Saroj contacted Prabhu to discuss the rates offered by Manoj and inquired why the plant should continue using his service when Manoj provided the same at a lower price. Prabhu realized that Manoj charged an extremely low price just to push Prabhu out of his business in the Steel Plant.
Which of the following reasons given by Prabhu will BEST help his cause?

Updated On: Jan 13, 2026
  • Prabhu should warn Saroj that Manoj’s offer is not sustainable.
  • Prabhu should request Saroj to talk to a few of his colleagues before taking any decision.
  • Prabhu should introduce Saroj to Ms. Nidhi Tawde, his regular customer.
  • Prabhu should offer to lower his price to the one offered by Manoj, exclusively for the steel plant.
  • Prabhu should tell Saroj that Manoj is unreliable and tardy, and women are unsafe with him.
Show Solution

The Correct Option is

Solution and Explanation

Step 1: Competitive Analysis.
Manoj's pricing is lower but may impact service quality and sustainability. Prabhu needs to establish his services as reliable and viable long-term.
Step 2: Evaluate Prabhu's Strategic Responses.
Challenging Manoj's unsustainable pricing strategy enables Prabhu to present a logical and professional appeal to Saroj.
Step 3: Option Assessment.
- Option 1: Emphasizing Manoj’s unsustainable pricing effectively addresses Saroj’s business considerations.
- Option 2: Proposing discussions might suggest indecisiveness.
- Option 3: Engaging other customers is not directly pertinent.
- Option 4: Replicating prices diminishes Prabhu’s service value.
- Option 5: Personal attacks on Manoj could damage Prabhu’s professional image.
Final Answer: (1)

Was this answer helpful?
0

Top Questions on Caselets

Questions Asked in XAT exam

Read the scenario and answer the question:
The upper hinge of a dataset is the median of all the values to the right of the median of the dataset in an ascending arrangement, while the lower hinge of the dataset is the median of all the values to the left of the median of the dataset in the same arrangement.
For example, consider the dataset 4, 3, 2, 6, 4, 2, 7. When arranged in the ascending order, it becomes 2, 2, 3, 4, 4, 6, 7. The median is 4 (the bold value), and hence the upper hinge is the median of 4, 6, 7, i.e., 6. Similarly, the lower hinge is 2. 
A student has surveyed thirteen of her teachers, and recorded their work experience (in integer years). Two of the values recorded by the student got smudged, and she cannot recall those values. All she remembers is that those two values were unequal, so let us write them as A and B, where A < B. The remaining eleven values, as recorded, are: 5, 6, 7, 8, 12, 16, 19, 21, 21, 27, 29. Moreover, the student also remembers the following summary measures, calculated based on all the thirteen values: 
Minimum: 2
Lower Hinge: 6.5 
Median: 12 
Upper Hinge: 21 
Maximum: 29
View Solution
Read the following scenario and answer the questions that follow.
A T20 cricket match consists of two teams playing twenty overs each, numbered 1 to 20. The runs scored in any over is a non-negative integer. The run rate at the end of any over is the average runs scored up to and including that over, i.e., the run rate at the end of the kth over is the average number of runs scored in overs numbered \(1, 2, …, k,\) where \(1 \leq k \leq 20, k\) a positive integer.
The following table indicates the run rate of a team at the end of some of the overs during a T20 cricket match (correct up to 2 decimal places), where \(1 \leq N – 2 < N + 6 \leq 20\), N a positive integer. It is also known that the team did not score less than 6 runs and more than 15 runs in any over.
Over NumberRun Rate
N-28.00
N7.43
N+28.11
N+48.45
N+68.08
View Solution