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Corporate Officer: Last year was an unusually poor one for

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Corporate Officer: Last year was an unusually poor one for [#permalink] New post 23 Aug 2009, 10:13
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A
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C
D
E

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43% (02:18) correct 57% (00:36) wrong based on 60 sessions
Corporate Officer: Last year was an unusually poor one for our chemical division, which has traditionally contributed about 60 percent of the corporation’s profits. It is therefore encouraging that there is the following evidence that the pharmaceutical division is growing stronger: it contributed 45 percent of the corporation’s profits, up from 20 percent the previous year.
On the basis of the facts stated, which of the following is the best critique of the evidence presented above?
(A) The increase in the pharmaceutical division’s contribution to corporation profits could have resulted largely from the introduction of single, important new product.
(B) In multidivisional corporations that have pharmaceutical divisions, over half of the corporation’s profits usually come from the pharmaceuticals.
(C) The percentage of the corporation’s profits attributable to the pharmaceutical division could have increased even if that division’s performance had not improved.
(D) The information cited does not make it possible to determine whether the 20 percent share of profits cited was itself an improvement over the year before.
(E) The information cited does not make it possible to compare the performance of the chemical and pharmaceutical divisions in of the percent of total profits attributable to each.
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Re: Corporate Officer [#permalink] New post 23 Aug 2009, 12:39
IMO E
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Re: Corporate Officer [#permalink] New post 23 Aug 2009, 15:45
I will go with E , what is your doubt here

A, B and C - makes no sense
D- up from 20 percent the previous year. So, D is wrong
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Re: Corporate Officer [#permalink] New post 24 Aug 2009, 03:07
I will go for C.
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Re: Corporate Officer [#permalink] New post 24 Aug 2009, 06:15
But this is strange because D and E are both correct.
D - percent go from 20 to 45, however it is from total. If total is 100 milion in the first year and 1 million in the next year, then 20% of 100 million is more than 45% of 1 million. So we do not know if improved
E - We do not know to what percentage chemical department drop so we can't compare

Explanation?
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Re: Corporate Officer [#permalink] New post 24 Aug 2009, 10:31
IMO C

Argument - Pharmaceutical Division is Growing Stronger (criticize or weaken the argument)

A - irrelevant to the argument
B - irrelevant to the argument
D - We are not interested in the 20% from the year before, only the 45% from this year
E - We are not interested in comparing the two (see argument)

C - This definitely weakens the argument as it suggests company profits overall could be down. They might also be down in absolute $ amount, just a less % than the other divisions.
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Re: Corporate Officer [#permalink] New post 24 Aug 2009, 12:05
what is the OA
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Re: Corporate Officer [#permalink] New post 24 Aug 2009, 17:01
hard one between C and D...would go with C, as it critiques that even if pharmaceutical division doesn't increase its performance but will increase its performance share due to the decrease in chemical division.

as for D, it says 20% up, but in D it didn't mention whether if it is refering to unclear to determine the share of profit increase or performance increase....so can't choose D.
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Re: Corporate Officer [#permalink] New post 25 Aug 2009, 00:59
i go with C.
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Re: Corporate Officer [#permalink] New post 25 Aug 2009, 02:27
Stuck between C and D. I would go with D. Whats the OA?
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Re: Corporate Officer [#permalink] New post 25 Aug 2009, 11:56
IMO E.

C only states that P profit is increasing. does not critique the conclusion that P profit is encouraging. Only E critique the conclusion by stating that P profit cannot be compared with C profit; therefore, P profit is not encouraging since we can't compare the two profits
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Re: Corporate Officer [#permalink] New post 25 Aug 2009, 15:56
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IMO C, As even if % Contributon is increasing, doesn't mean that Actual value of is increasing.


WHAT OA?
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Re: Corporate Officer [#permalink] New post 27 Aug 2009, 10:59
C is suggests that pharmaceutical department contributed more percentage of profit but its performance had not been improved. So it calls into question that did this department is growing stronger as stated in the conclusion.

SO I think it's C
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Re: Corporate Officer [#permalink] New post 27 Aug 2009, 11:58
C seems to be correct. Pharmaceutical share of sales could go up even if the total company sales slump. This is the fallacy of ratios and proportions. If the total sales decrease and the pharma sales stay where they were, even then, the % of pharma sales will go up. % increase is not the same thing as absolute increase!
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Re: Corporate Officer [#permalink] New post 27 Aug 2009, 23:22
Went on to search tha answer.....OA is C.........but its pretty tough...no doubt its a CAT ( IIM) ques..But pls someone explain why E is wrong...what is use of 60% of chemical division then...
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Re: Corporate Officer [#permalink] New post 28 Aug 2009, 01:33
rohansherry wrote:
Went on to search tha answer.....OA is C.........but its pretty tough...no doubt its a CAT ( IIM) ques..But pls someone explain why E is wrong...what is use of 60% of chemical division then...




(E) The information cited does not make it possible to compare the performance of the chemical and pharmaceutical divisions in of the percent of total profits attributable to each.

is the author using the performance of both companies to draw his conclusion? I'd say no
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Re: Corporate Officer [#permalink] New post 28 Aug 2009, 02:22
i would choose c- since the passage assumes that total profits have not changed - however if total's profits have reduced... it is possible for the pharmecuital division to contribute more without growing.
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Re: Corporate Officer [#permalink] New post 02 Dec 2009, 13:33
@ubsCSG how could u assume that the overall profit haven't changed. The passage strictly mentions about the stats of pharma and chemical. Could u please explain in detail why the answer cannot be E?
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Re: Corporate Officer [#permalink] New post 02 Dec 2009, 14:18
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sagarsabnis wrote:
@ubsCSG how could u assume that the overall profit haven't changed. The passage strictly mentions about the stats of pharma and chemical. Could u please explain in detail why the answer cannot be E?


In this kind of questions is useful to pick numbers to prove the answer choice.

Let's say that last year the company had $100 profit

chemical division ---> $60 --->60%
pharmaceutical division --->$20 ---->20%
others ------> $20

This year the company has $45 profit
pharmaceutical division --->$20 ----> 45%
chemical division ---> $15 --->33%
others ------> $10 ---> 22%

what the passage says is that the pharmaceutical division is growing faster, well this is not true since its profits haven't increased.
This is way C is correct. You don't need to assume that the total profits haven't changed, in fact if they don't change the passage is true.

(E) The information cited does not make it possible to compare the performance of the chemical and pharmaceutical divisions in of the percent of total profits attributable to each

this means that you don't have the percentage of the chemical division. Do you need the percentage of the chemical division to conclude that the pharmaceutical division is growing stronger?

the author did not compare the performance but rather said that the pharmaceutical division is growing stronger. It's obvious that the chemical division performed worse that the pharmaceutical division last year but that is not the conclusion of the argument.
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Re: Corporate Officer [#permalink] New post 02 Dec 2009, 14:45
Guys, please tag the source!
Re: Corporate Officer   [#permalink] 02 Dec 2009, 14:45
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