medium · GMAT Verbal
An online retailer began offering free returns on all clothing purchases in order to boost sales. Sales of clothing did rise substantially afterward, yet the retailer's net profit from its clothing division fell over the same period.
Which of the following, if true, most helps to explain this apparent discrepancy?
- Customers increasingly ordered multiple sizes and colors of the same garment, always intending to return most of what they had ordered.
- The retailer's clothing division employed roughly the same number of customer service staff before and after the new return policy began.
- Several rival online retailers announced similar free-return policies shortly after this retailer's own policy was first introduced.
- Customer reviews of the clothing division's products became noticeably more positive after the free-return policy took effect fully.
- The retailer's electronics division, which the new return policy did not affect, saw no meaningful change in its own net profit.
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