What allowed Argyle's small, lower quality stones to be processed for the jewelry market?

What allowed Argyle's small, lower quality stones to be processed for the jewelry market?

• A. The low wage, Indian cutting industry
• B. Advances in synthetic diamond production
• C. Government subsidies for gem processing
• D. Innovative marketing in luxury segments

Answer: (A)

Cost efficiency in finishing diamonds drives whether small, lower-quality stones can be profitably turned into market-ready gems. India has a long-established, low-wage cutting and polishing industry, which dramatically reduces labor costs and makes it economical to process these stones that would be unprofitable in higher-cost centers. By sending Argyle’s roughs to these centers, many stones can be cut, faceted, and polished into marketable pieces, expanding supply for the jewelry market. Advances in synthetic diamond production would change the product mix rather than enable processing of natural stones, and subsidies or marketing alone don’t address the core cost issue. So, the low-wage Indian cutting industry is what makes this feasible.

Cost efficiency in finishing diamonds drives whether small, lower-quality stones can be profitably turned into market-ready gems. India has a long-established, low-wage cutting and polishing industry, which dramatically reduces labor costs and makes it economical to process these stones that would be unprofitable in higher-cost centers. By sending Argyle’s roughs to these centers, many stones can be cut, faceted, and polished into marketable pieces, expanding supply for the jewelry market. Advances in synthetic diamond production would change the product mix rather than enable processing of natural stones, and subsidies or marketing alone don’t address the core cost issue. So, the low-wage Indian cutting industry is what makes this feasible.