Find all School-related info fast with the new School-Specific MBA Forum

It is currently 23 Sep 2014, 18:41

Close

GMAT Club Daily Prep

Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track
Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.

Events & Promotions

Events & Promotions in June
Open Detailed Calendar

Companies that must determine well in advance of the

  Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
TAGS:
Manager
Manager
avatar
Joined: 21 Aug 2012
Posts: 171
Followers: 0

Kudos [?]: 10 [0], given: 7

Companies that must determine well in advance of the [#permalink] New post 16 Jan 2013, 05:05
Companies that must determine well in advance of the selling season how many units of a new product to manufacture often underproduce products that sell well and have overstocks of others. The increased incidence in recent years of mismatches between production and demand seems ironic, since point-of-sale scanners have improved data on consumers’ buying patterns and since flexible manufacturing has enabled companies to 24 produce, cost-effectively, small quantities of goods. This type of manufacturing has greatly increased the number of new products introduced annually in the United States. However, frequent introductions of new products have two problematic side effects. For one, they reduce the average lifetime of products; more of them are neither at the beginning of their life (when prediction is difficult) or at the end of their life (when keeping inventory is expensive because the products will soon become obsolete). For another, as new products proliferate, demand is divided among a growing number of stock-keeping units (SKU’s). Even though manufacturers and retailers can forecast aggregate demand with some certainty, forecasting accurately how that demand will be distributed among the many SKU’s they sell is difficult. For example, a company may be able to estimate accurately the aggregate number of shoes it will sell, but it may be uncertain about which specific types of shoes will sell more than other types.
Q35:Which of the following most accurately describes the function of the last sentence in the passage (Last 2 lines)?
A.To cite a situation in which the aggregate demand is more important than the distribution of demand among SKU’s
B.To refute an assertion about the side effects of flexible manufacturing
C.To illustrate an assertion about companies’ ability to forecast demand
D.To provide an example of ways in which companies address the difficulties of forecasting demand
E.To note an exception to the author’s assertion about distributing demand among SKU’s
[Reveal] Spoiler:
C


The passage suggests which of the following about divided demand among a growing number of SKU’s?
A. It has increased the average lifetime of products.
B. It has resulted from retailer’s attempts to predict demand more accurately and
avoid both understocks and overstocks.
C. It has decreased the use of flexible manufacturing by companies.
D. It has not increased the expense of keeping inventory of certain products.
E. It has not prevented companies from predicting aggregate demand with some certainty.
[Reveal] Spoiler:
E


According to the passage, which of the following has led to growth in the number of new products introduced in the United States each year?
A. Reduced average lifetime of products
B. Increased ability to forecast aggregate demand
C. More cost-effective ways of keeping inventory for products
D. Cost-effective production of small quantities of goods
E. Increased ability to divide demand among a number of SKU’s and to forecast how that demand will be distributed among those SKU’
[Reveal] Spoiler:
D


Last edited by roopika2990 on 26 Jan 2013, 23:58, edited 1 time in total.
Intern
Intern
User avatar
Joined: 29 Nov 2012
Posts: 6
WE: Consulting (Commercial Banking)
Followers: 0

Kudos [?]: 2 [0], given: 13

Re: Companies that must detemine well in advance of the selling [#permalink] New post 23 Jan 2013, 05:47
IMO 1C / 2E / 3D
Hope It's right.
_________________

"We must do that which we think we cannot."

Senior Manager
Senior Manager
avatar
Joined: 08 Jun 2010
Posts: 454
Followers: 0

Kudos [?]: 28 [0], given: 39

GMAT Tests User
Re: Companies that must detemine well in advance of the selling [#permalink] New post 23 Jan 2013, 21:03
2 must be D.
'predicet with some certainty for some product " means D.
Re: Companies that must detemine well in advance of the selling   [#permalink] 23 Jan 2013, 21:03
    Similar topics Author Replies Last post
Similar
Topics:
Companies, investors, and governments must Game 0 23 Jun 2014, 00:34
1 Experts publish their posts in the topic A data company recently conducted a survey to determine wh emmak 10 08 Jun 2013, 01:11
2 Experts publish their posts in the topic Companies, investors, and governments must relearn the rajcools 9 19 Apr 2012, 04:01
1 The OLEX Petroleum Company has recently determined that it fiesta 13 04 Aug 2008, 03:14
The OLEX Petroleum Company has recently determined that it nakib77 8 05 Nov 2005, 13:13
Display posts from previous: Sort by

Companies that must determine well in advance of the

  Question banks Downloads My Bookmarks Reviews Important topics  


GMAT Club MBA Forum Home| About| Privacy Policy| Terms and Conditions| GMAT Club Rules| Contact| Sitemap

Powered by phpBB © phpBB Group and phpBB SEO

Kindly note that the GMAT® test is a registered trademark of the Graduate Management Admission Council®, and this site has neither been reviewed nor endorsed by GMAC®.