Grade cuts happen at round one, but that is by no means the only reason a girl would get cut. There wouldn't be nearly enough girls to eliminate on that criterion alone. With RFM working correctly, the chapters have to make significant cuts at each stage of the process. Plus, that would mean every chapter would be pulling from the same list of girls, since the variation on grade requirements isn't that different between chapters.
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"Traveling - It leaves you speechless, then turns you into a storyteller. ~ Ibn Battuta
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