📊 GMAT Exam Prep

Document 1 is a press release from 'TechInnovate Corp.' announcing a groundbreaking AI algorithm that significantly reduces processing time for complex data analysis tasks. Document 2 is the annual report of 'DataStream Analytics Inc.,' a direct competitor, which indicates a 5% increase in operational expenses and a flat revenue growth for the past fiscal year. Based on both documents, which statement is most likely to be true?

A DataStream Analytics Inc. will likely see a significant increase in its customer base next quarter.
B TechInnovate Corp.'s new algorithm will not impact the market due to DataStream Analytics Inc.'s established presence.
C DataStream Analytics Inc. may face increased competitive pressure to innovate or improve efficiency.
D The new AI algorithm will be universally adopted across the industry within three months.

✓ Correct Answer: Option C

TechInnovate's innovation represents a competitive threat. DataStream's flat revenue and rising expenses suggest existing challenges, which would be exacerbated by a competitor's breakthrough, compelling them to respond.

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