New stores financed by investors have a

New stores financed by investors have a much lower failure rate than stores financed by other means. Source of financing, therefore, must be a more important causative factor in the success of a new store than are such factors as the location of the store, the quality of the staff, or the choice of merchandise.

Which of the following, if true, most seriously weakens the argument above?

(A) Investors tend to be more responsive than others to changes in a new store’s financial needs.

(B)  The strategic planning of a new store is a less important factor in the long-term success of the business than are the personal characteristics of the owner.

(C)  More than half of all new stores close within three years.

(D) The management of new stores is generally less formal than the management of ongoing stores.

(E)  Investors base their decisions to fund new stores on such factors as the personal characteristics of the owner, location of the store, and marketing goals.


The best answer is E.  The argument is that source of financing must be a more important causative factor in the success of a new store than other factors.  Choice E suggests that it is not the source of financing that makes the difference, rather that investors are more likely to finance new stores in which the other factors -  good locations, good quality of staff etc. - are good.