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

It is currently 22 Oct 2014, 20:12

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

Critical Reasoning - Unable to find answer anywhere:(

  Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
TAGS:
Intern
Intern
avatar
Joined: 11 Jul 2013
Posts: 6
Followers: 0

Kudos [?]: 1 [0], given: 0

Critical Reasoning - Unable to find answer anywhere:( [#permalink] New post 19 Sep 2013, 18:29
00:00
A
B
C
D
E

Difficulty:

(N/A)

Question Stats:

100% (02:04) correct 0% (00:00) wrong based on 0 sessions
Alexander Verna, CEO of Drugnorm is evaluating the option of manufacturing generic version of a bestselling and soon to go off the patent drug. Mark, the marketing head, has determined that the company could charge a maximum price of $5 for the standard dose of the product. Alexander does not wish to produce any product that will not generate at least a 25 percent gross profit margin.

The answer to which of the following questions would be most relevant to the CEO in determining whether or not to produce a generic form of this drug?

A. If the company does produce the drug, what color should its container be?
B. How much did the rival company charge for a standard dose of the drug when it first came on the market?
C. Does the company's sales force currently understand the pharmaceutical properties of this particular drug?
D. By how much did the company's total revenue increase or decrease over the last five years?
E. What will be the average cost per standard dose to manufacture and sell this product?

What is the answer for this? I am not able to come up with a reason. Is it B?
Manager
Manager
avatar
Joined: 28 Feb 2011
Posts: 51
Location: India
Concentration: Finance, General Management
GPA: 3.77
WE: Information Technology (Computer Software)
Followers: 0

Kudos [?]: 16 [0], given: 218

Re: Critical Reasoning - Unable to find answer anywhere:( [#permalink] New post 19 Sep 2013, 18:53
Do you mean to say the source did not specify the answer for this question ?

As far as my understanding, I choose E.

As I was going through the choices, the answer could be either C or E and finally selected E.
_________________

Best Regards,
RS

Intern
Intern
avatar
Joined: 11 Jul 2013
Posts: 6
Followers: 0

Kudos [?]: 1 [0], given: 0

Re: Critical Reasoning - Unable to find answer anywhere:( [#permalink] New post 19 Sep 2013, 18:56
Yea that's right! The source did not specify the answer.
Can you explain to me why it is E?
Manager
Manager
avatar
Joined: 28 Feb 2011
Posts: 51
Location: India
Concentration: Finance, General Management
GPA: 3.77
WE: Information Technology (Computer Software)
Followers: 0

Kudos [?]: 16 [0], given: 218

Re: Critical Reasoning - Unable to find answer anywhere:( [#permalink] New post 19 Sep 2013, 19:18
Actually, this is how I approached it ( other forum members, please correct me if I am going wrong somewhere)

A) seemed irrelevant. We are NO where talking about the color. Our main motto is to bring in an increase in revenue of Drugnorm's company.

B) I did not choose this one because as far as my understanding from the question, the plan is to bring an increase in revenue of Drugnorm's company without doing any comparisons with our company. Also, the statement mentioned 'patent', so, it should be specific to this company only and that's why I did think that doing comparisons with other company will hold any good here. Thus, did not choose B.

C) I do understand that there is a discussion about the Marketing head, suggesting a maximum price for the drug. But, I still did not choose this choice because I found it too extreme and not very much limited to the context we are talking about. If we are talking about profit, we would surely see what's the costs that have been incurred in preparing the product and then similarly will put a cap on what's the selling price should be to attain a specific profit margin. I did not see that happening here.

d) My understanding of the question stem says that we are trying to increase the gross margin for a particular product and thus did not go for this choice as it talks about the company's performance from the last 5 years; again quite too extreme for me to consider.

and thus finally selected E. It talks about the average cost the company will be bearing to produce the product and the same can be helpful in arriving at the profit margin cap.

Hope this helps in some way.

Please do correct me I did not get this question correctly. Thanks in advance !!
_________________

Best Regards,
RS

Intern
Intern
avatar
Joined: 11 Jul 2013
Posts: 6
Followers: 0

Kudos [?]: 1 [0], given: 0

Re: Critical Reasoning - Unable to find answer anywhere:( [#permalink] New post 19 Sep 2013, 19:33
Oh god! thanks Rahul. This actually makes alot of sense now!!
Senior Manager
Senior Manager
User avatar
Joined: 03 Dec 2012
Posts: 367
Followers: 0

Kudos [?]: 40 [0], given: 291

Re: Critical Reasoning - Unable to find answer anywhere:( [#permalink] New post 12 Oct 2013, 04:13
Its a straight E. Working in pharmaceutical sales has finally paid off :p
Re: Critical Reasoning - Unable to find answer anywhere:(   [#permalink] 12 Oct 2013, 04:13
    Similar topics Author Replies Last post
Similar
Topics:
37 Critical Reasoning – the “Best” Wrong Answer MarkSullivan 6 30 Jul 2012, 15:55
11 Experts publish their posts in the topic Critical reasoning Answers and Explantions Vavali 8 09 Feb 2008, 00:18
Critical Reasoning Approach: Finding the assumption darwazah 3 24 Dec 2006, 16:07
Critical Reasoning MBA2ran 12 10 Aug 2006, 20:57
Critical Reasoning rianah100 2 04 Oct 2005, 16:29
Display posts from previous: Sort by

Critical Reasoning - Unable to find answer anywhere:(

  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®.