The following appeared as part of a business plan created by the management of the Take Heart Fitness Center.
“After opening the new swimming pool early last summer, Take Heart saw a 12 percent increase in the use of the center by members. Therefore, in order to increase the number of our members and thus our revenues, which depend on membership fees, we should continue to add new recreational facilities in subsequent years: for example, a multipurpose game room, a tennis court, and a miniature golf course. Being the only center in the area offering this range of activities would give us a competitive advantage in the health and recreation market.”
Take Heart健身中心的管理者起草的商业计划：
去年夏天开了新的游泳池以后，TH发现会员对中心的使用率增加了12%。因此，为了增加我们的会员数量和决定于会员费的收入，我们应该在以后几年中继续增加新的娱乐设施：比如，一个多功能游戏室，一个网球场，一个迷你高尔夫球场。作为本地唯一一家提供各种活动的健身中心，我们将在健身和娱乐市场建立竞争优势。
1. 忽略他因。
2. 错误类比。
3. 收入和支出
1. causal oversimplification
2. a benefit-cost analysis should be given
3. Whether the proposed recreational facilities are popular among the people of this area is unknown.
Because Take Heart Fitness Center experienced a 12 percent increase in member usage as a result of opening a new swimming pool last summer, the author recommends the addition of new recreational facilities in subsequent years as a means of increasing membership in Take Heart. The author’s recommendation is problematic for several reasons.
First, and foremost, the author assumes that an increase in member usage portends an increase in membership. This assumption may hold true in some cases. However, it is unlikely to hold true in the case at hand, because it is reasonable to expect that members would visit the fitness center to inspect and try out the new swimming pool. This would account for the increase in usage. However, since the author provides no evidence that this new rate of usage was sustained, the abrupt increase in usage provides little evidence that the addition of facilities such as the pool will attract new members.
Second, the author assumes that the addition of the swimming pool was responsible for the increase in member usage. However, the only evidence for this claim is insufficient to establish the causal claim in question. While temporal precedence is one of the conditions required to establish a causal relationship between two events, by itself it is not a sufficient condition. Consequently, it is possible that the addition of the pool was unrelated to the increase in usage in the manner required by the author’s argument.
Finally, the author has provided no evidence to support the contention that Take Heart will be the only center in the area to offer a wide range of activities to its members and thus have a competitive advantage in the fitness market.
In conclusion, the author’s belief that adding additional recreational facilities will increase Take Heart’s membership is ill-founded. To strengthen the argument the author would have to provide evidence that member usage is reliable indicator of new membership. Additionally, it would be necessary to show that the cause of the increase in usage was the opening of the new pool.
110. The following appeared as part of a memorandum from the loan department of the Frostbite National Bank.
“We should not approve the business loan application of the local group that wants to open a franchise outlet for the Kool Kone chain of ice cream parlors. Frostbite is known for its cold winters, and cold weather can mean slow ice cream sales. For example, even though Frostbite is a town of 10,000 people, it has only one ice cream spot — the Frigid Cow. Despite the lack of competition, the Frigid Cow’s net revenues fell by 10 percent last winter.”
Frostbite国家银行的借贷部门的备忘录：
我们不应该批准那个希望开一家KK冰激凌连锁店的特许店的本地团体的借贷请求。Frostbite以其寒冷的冬天而闻名，而冷天气意味着冰激凌的销售不利。比如，虽然Frostbite是个有10000人的镇子，它却只有一家冰激凌店Frigid Cow。尽管缺乏竞争，Frigid Cow的净收入去年冬天下降了10%。
1. Other factors in deciding whether to give loan to a company such as the credit of the company should be considered.
2. Admittedly, the former and prospective performance of the company is also important when the bank have to make decision of whether or not should it give loan to a company. However, the author of the memorandum show no sufficient evidence to support his or her proposal that the bank should not give loan to Kool Kone chain of ice cream parlors.
3. The statistics last year does not necessarily denote the future trend.
1， 排除他因，净收入下降的原因是什么?可能是经营不好，草率定价，甚至正因为缺乏竞争导致了这些。
2， 寒冷冬天不等于没有夏天，也不等于夏天短暂。不能说明原因。
In this memorandum the loan department of Frostbite National Bank recommends against approval of a business loan to a local group that wants to open an ice cream parlor. In support of this decision the loan department points out that Frostbite has a reputation for cold winters and sales of ice cream decrease in cold weather. This latter point is buttressed by the fact that Frostbite’s only ice cream parlor suffered a 10 percent decline in net revenues the previous winter. The loan department’s decision is questionable for the following reasons.
To begin with, since it is reasonable to expect a decline in ice cream sales during winter months, it is difficult to assess the relevance of the fact that Frostbite has cold winters to the potential success of the Kool Kone franchise. Common sense suggests that this fact would be significant only if it turned out that Frostbite’s winter season lasted 9 or 10 months as it does in arctic regions. In that case slow sales could be expected for most of the year and the loan department’s opposition to the loan would be readily understandable. If, on the other hand, Frostbite’s winter season lasts only a few months and the remainder of the year is warm or hot, it is difficult to comprehend the loan department’s reasoning.
Next, the loan department assumes that the Frigid Cow’s decline in net revenue last winter was a result of slow sales occasioned by cold weather. While this is a possible reason for the decline, it is not the only factor that could account for it. For example, other factors such as poor business practices or lack of inventory could be responsible for the Frigid Cow’s loss of revenue. The loan department’s failure to investigate or even consider these and other possible explanations for the Frigid Cow’s decline in revenue renders their decision highly suspect.
In conclusion, the loan department’s decision is ill-founded. To better evaluate the decision, we would need to know more about the length and severity of Frostbite’s winter season. Moreover, evidence would have to be provided to support the assumption that the Frigid Cow’s loss of revenue last winter was a direct result of the cold weather.