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

It is currently 22 Jul 2014, 15:58

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

First-time computer buyers buying PXC home computers

  Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
TAGS:
1 KUDOS received
Senior Manager
Senior Manager
User avatar
Joined: 07 Jan 2008
Posts: 418
Followers: 3

Kudos [?]: 61 [1] , given: 0

GMAT Tests User
First-time computer buyers buying PXC home computers [#permalink] New post 25 Jun 2008, 00:46
1
This post received
KUDOS
1
This post was
BOOKMARKED
00:00
A
B
C
D
E

Difficulty:

  5% (low)

Question Stats:

86% (04:11) correct 14% (01:24) wrong based on 49 sessions
First-time computer buyers buying PXC home computers typically buy models that cost much less and have a smaller profit margin per computer than do PXC computers bought by people replacing their computers with more powerful models. Last year PXC's profits from computer sales were substantially higher than the previous year, although about the same number of PXC computers were sold and the prices and profit margins for each computer model that PXC sells remained unchanged.

If the statements above are true, which of the following is most strongly supported by them?

(A) PXC's competitors raised the prices on their computers last year, making PXC computers more attractive to first-time computer buyers.
(B) The number of people buying PXC computers who also bought PXC computer-related products, such as printers, was larger last year than the previous year.
(C) Among computer buyers who bought a PXC computer to replace their existing computer, the proportion who were replacing a computer made by a competitor of PXC was greater last year than the previous year.
(D) The proportion of PXC computers bought by first-time computer buyers was smaller last year than the previous year.
(E) PXC's production costs for its computers were lower last year than they had been the previous year.
Senior Manager
Senior Manager
User avatar
Joined: 14 Mar 2007
Posts: 319
Location: Hungary
Followers: 1

Kudos [?]: 16 [0], given: 3

GMAT Tests User
Re: CR: PXC computer [#permalink] New post 25 Jun 2008, 01:09
I think, the answer is D.
Senior Manager
Senior Manager
User avatar
Joined: 15 Aug 2007
Posts: 291
Followers: 3

Kudos [?]: 55 [0], given: 0

GMAT Tests User
Re: CR: PXC computer [#permalink] New post 25 Jun 2008, 02:00
Straight D.
Manager
Manager
avatar
Joined: 09 May 2008
Posts: 102
Followers: 1

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

Re: CR: PXC computer [#permalink] New post 25 Jun 2008, 08:29
lexis wrote:
First-time computer buyers buying PXC home computers typically buy models that cost much less and have a smaller profit margin per computer than do PXC computers bought by people replacing their computers with more powerful models. Last year PXC's profits from computer sales were substantially higher than the previous year, although about the same number of PXC computers were sold and the prices and profit margins for each computer model that PXC sells remained unchanged.

If the statements above are true, which of the following is most strongly supported by them?

(A) PXC's competitors raised the prices on their computers last year, making PXC computers more attractive to first-time computer buyers.
- but the number of PXC computers sold remained constant.
(B) The number of people buying PXC computers who also bought PXC computer-related products, such as printers, was larger last year than the previous year.
- correct
(C) Among computer buyers who bought a PXC computer to replace their existing computer, the proportion who were replacing a computer made by a competitor of PXC was greater last year than the previous year.
- irrelevant
(D) The proportion of PXC computers bought by first-time computer buyers was smaller last year than the previous year.
- irrelevant
(E) PXC's production costs for its computers were lower last year than they had been the previous year.
- profit margins are constant, so this can't be the answer.

IMO (B) is correct.
Manager
Manager
avatar
Joined: 31 Jul 2006
Posts: 229
Followers: 1

Kudos [?]: 12 [0], given: 0

GMAT Tests User
Re: CR: PXC computer [#permalink] New post 25 Jun 2008, 11:18
D would be my answer on this.

All the other variables remaining the same as in the year before, number of first time and second-time buyers would decide the final profit margins (lower or higher).

In this case the profits are higher hence number of second time buyers > number of first time buyers.
Manager
Manager
avatar
Joined: 14 May 2008
Posts: 72
Followers: 1

Kudos [?]: 21 [0], given: 0

Re: CR: PXC computer [#permalink] New post 25 Jun 2008, 11:48
D :)
Director
Director
avatar
Joined: 05 Jan 2008
Posts: 709
Followers: 2

Kudos [?]: 85 [0], given: 0

GMAT Tests User
Re: CR: PXC computer [#permalink] New post 25 Jun 2008, 11:56
D for me

The question clearly shows that of the bought computers the majority of the computers are replacements as only that way the profit margins would be more and thus D, D shows that the proportion of 1st time buyers is less


First-time computer buyers buying PXC home computers typically buy models that cost much less and have a smaller profit margin per computer than do PXC computers bought by people replacing their computers with more powerful models. Last year PXC's profits from computer sales were substantially higher than the previous year,
Quote:
although about the same number of PXC computers were sold
and the prices and profit margins for each computer model that PXC sells remained unchanged.

_________________

Persistence+Patience+Persistence+Patience=G...O...A...L

Senior Manager
Senior Manager
User avatar
Joined: 07 Jan 2008
Posts: 418
Followers: 3

Kudos [?]: 61 [0], given: 0

GMAT Tests User
Re: CR: PXC computer [#permalink] New post 25 Jun 2008, 21:08
D is OA!
Expert Post
Verbal Forum Moderator
Verbal Forum Moderator
User avatar
Status: Preparing for the another shot...!
Joined: 03 Feb 2011
Posts: 1425
Location: India
Concentration: Finance, Marketing
GPA: 3.75
Followers: 123

Kudos [?]: 563 [0], given: 62

GMAT ToolKit User GMAT Tests User Premium Member
Re: CR: PXC computer [#permalink] New post 09 Oct 2011, 01:23
Expert's post
1
This post was
BOOKMARKED
it was straightforward D...
wats the level of this question

_________________

Prepositional Phrases Clarified|Elimination of BEING| Absolute Phrases Clarified
Rules For Posting
www.Univ-Scholarships.com

Senior Manager
Senior Manager
avatar
Joined: 25 Nov 2011
Posts: 261
Location: India
Concentration: Technology, General Management
GPA: 3.95
WE: Information Technology (Computer Software)
Followers: 3

Kudos [?]: 34 [0], given: 20

Re: CR: PXC computer [#permalink] New post 16 Jan 2012, 06:39
gmatcrook wrote:
D would be my answer on this.

All the other variables remaining the same as in the year before, number of first time and second-time buyers would decide the final profit margins (lower or higher).

In this case the profits are higher hence number of second time buyers > number of first time buyers.


I also agree with D.

But C is also a strong contender because it also tells us that there are more no. of sales of costly computers. But, we can eliminate this because the argument uses the word 'TYPICALLY' in the first statement, which means even first time buyers are also buying costly computers. This fact is reflected only in D but not in C.

_________________

-------------------------
-Aravind Chembeti

Senior Manager
Senior Manager
avatar
Joined: 13 Aug 2010
Posts: 316
Followers: 1

Kudos [?]: 7 [0], given: 1

GMAT Tests User
Re: First-time computer buyers buying PXC home computers [#permalink] New post 16 Jan 2012, 07:42
+1 for D
2 KUDOS received
Senior Manager
Senior Manager
User avatar
Joined: 19 Apr 2011
Posts: 291
Schools: Booth,NUS,St.Gallon
Followers: 4

Kudos [?]: 63 [2] , given: 51

GMAT Tests User
Re: First-time computer buyers buying PXC home computers [#permalink] New post 28 Jan 2012, 13:44
2
This post received
KUDOS
D .Assume that the no of computers sold are the same for both the years .Since the propotion of the number of computers bought by first timers is less last year .It leads to a higher profit since more number of computers are bought by people who are replacing their old computers .

_________________

+1 if you like my explanation .Thanks :)

Manager
Manager
avatar
Status: MBA Aspirant
Joined: 12 Jun 2010
Posts: 178
Location: India
Concentration: Finance, International Business
WE: Information Technology (Investment Banking)
Followers: 3

Kudos [?]: 17 [0], given: 1

GMAT Tests User
Re: First-time computer buyers buying PXC home computers [#permalink] New post 05 Feb 2012, 20:26
I got my answer as C, but looks like it is wrong here :(
Senior Manager
Senior Manager
User avatar
Status: May The Force Be With Me (D-DAY 15 May 2012)
Joined: 06 Jan 2012
Posts: 292
Location: India
Concentration: General Management, Entrepreneurship
Followers: 1

Kudos [?]: 68 [0], given: 16

Reviews Badge
Re: First-time computer buyers buying PXC home computers [#permalink] New post 13 Feb 2012, 00:56
+1 D

_________________

Giving +1 kudos is a better way of saying 'Thank You'.

Intern
Intern
avatar
Joined: 13 Feb 2012
Posts: 20
WE: Other (Transportation)
Followers: 0

Kudos [?]: 11 [0], given: 14

Re: First-time computer buyers buying PXC home computers [#permalink] New post 13 Feb 2012, 14:21
Clear D for me, as well!! The truth is that I got confused with the difference between "last year" and "previous year". I thought it was the same. (Clearly not a native speaker!!)
1 KUDOS received
Manager
Manager
avatar
Joined: 22 Jan 2012
Posts: 90
Location: India
Concentration: General Management, Technology
GMAT 1: Q39 V29
GPA: 3.3
WE: Engineering (Consulting)
Followers: 5

Kudos [?]: 45 [1] , given: 7

Re: First-time computer buyers buying PXC home computers [#permalink] New post 15 Feb 2012, 06:22
1
This post received
KUDOS
First-time computer buyers buying PXC home computers typically buy models that cost much less and have a smaller profit margin per computer than do PXC computers bought by people replacing their computers with more powerful models. Last year PXC's profits from computer sales were substantially higher than the previous year, although about the same number of PXC computers were sold and the prices and profit margins for each computer model that PXC sells remained unchanged.

If the statements above are true, which of the following is most strongly supported by them?

(A) PXC's competitors raised the prices on their computers last year, making PXC computers more attractive to first-time computer buyers.
- but the number of PXC computers sold remained constant so its not the correct option.
(B) The number of people buying PXC computers who also bought PXC computer-related products, such as printers, was larger last year than the previous year.
- not relevant question didnt speak about other products.
(C) Among computer buyers who bought a PXC computer to replace their existing computer, the proportion who were replacing a computer made by a competitor of PXC was greater last year than the previous year. --- this doesnt speak about the raise in profits of PXC
- irrelevant
(D) The proportion of PXC computers bought by first-time computer buyers was smaller last year than the previous year.
- since first time buyers are smaller the replacement buyers are more and the sales are constant the replacement sales resulted in more profits so correct answer.
(E) PXC's production costs for its computers were lower last year than they had been the previous year.
- profit margins are constant, so this can't be the answer.

_________________

Press +1 Kudos rather than saying thanks
which is more helpful infact..

Ill be posting good questions as many as I can...

Towards Success

Director
Director
User avatar
Status: 1,750 Q's attempted and counting
Affiliations: University of Florida
Joined: 09 Jul 2013
Posts: 513
Location: United States (FL)
Schools: UFL (A)
GMAT 1: 600 Q45 V29
GMAT 2: 590 Q35 V35
GMAT 3: 570 Q42 V28
GMAT 4: 610 Q44 V30
GPA: 3.45
WE: Accounting (Accounting)
Followers: 18

Kudos [?]: 226 [0], given: 629

Re: First-time computer buyers buying PXC home computers [#permalink] New post 30 Oct 2013, 21:13
Answer (D) The proportion of PXC computers bought by first-time computer buyers was smaller last year than the previous year.

F = first time computer , Profit Margin = 10 | U = Upgraded computer , Profit Margin = 40

LY (last year) & PY (previous year) computers sold = 10 [Stimulus tells us that # of computers "was about the same"]

This year = 2013, Last Year = 2012, Previous Year = 2011
2012 - Total Profit (LY) = 2 * 10 + 8 * 40 = 340 ---> Proportion of F computer 20%
2011- Total Profit (PY) = 5 * 10 + 5 * 40 = 250 ---> Proportion of F computer 50%

Profit increased 340-250=90 or 9/25 or 36%. Substantial increase in profits with no change in the # of computers sold. because proportion of first time was smaller LY (20%) than the PY (50%)

_________________

Got Kudos? :) Tis better to give than receive | ANALYSIS OF MOST DIFFICULT QUESTION TYPES
Need motivation? check out this video or this one | "We are what we repeatedly do. Excellence, then, is not an act, but a habit." - Aristotle
100 HARDEST CR QUESTIONS | 100 HARDEST SC QUESTIONS | 100 HARDEST PS QUESTIONS| 25 HARDEST QUESTIONS | 225 RC PASSAGES W/ TIMER!!!
PS QUESTION DIRECTORY|DS QUESTION DIRECTORY | SC QUESTION DIRECTORY | CR QUESTION DIRECTORY | RC QUESTION DIRECTORY

BEST OVERALL QUANT BOOK FOR THE MONEY | MAXIMIZE YOUR STUDY TIME

Manager
Manager
User avatar
Status: Where Focus Goes Energy Flows
Joined: 19 Sep 2008
Posts: 52
Location: United States (CA)
Target GMAT Score: 700
Concentration: General Management, Strategy
GPA: 3.25
WE: Engineering (Consumer Electronics)
Followers: 0

Kudos [?]: 12 [0], given: 46

GMAT ToolKit User
Re: First-time computer buyers buying PXC home computers [#permalink] New post 10 Nov 2013, 00:25
Straight D

C is a shell game Answer choice. Look at the shift in the answer choice "competitors" I almost was certain it's was C after couple of second but when I read competitor that clicked aah this one is a trap.

_________________

Where Focus Goes Energy Flows....Follow you dream and passion.

Intern
Intern
User avatar
Joined: 08 Nov 2013
Posts: 5
Location: United States
Concentration: Finance, Leadership
GMAT 1: 710 Q43 V44
WE: Real Estate (Investment Banking)
Followers: 0

Kudos [?]: 5 [0], given: 15

CAT Tests
Re: First-time computer buyers buying PXC home computers [#permalink] New post 10 Nov 2013, 01:08
Lets take a look at each choice:

First-time computer buyers buying PXC home computers typically buy models that cost much less and have a smaller profit margin per computer than do PXC computers bought by people replacing their computers with more powerful models. Last year PXC's profits from computer sales were substantially higher than the previous year, although about the same number of PXC computers were sold and the prices and profit margins for each computer model that PXC sells remained unchanged.

If the statements above are true, which of the following is most strongly supported by them?

(A) PXC's competitors raised the prices on their computers last year, making PXC computers more attractive to first-time computer buyers.
The argument states that the same number of PXC computers were sold. (A) Says that first-time computer buyers were more attracted to PXC computers and therefore wants to trick you into thinking that more people bought PXC computers and thus, PXC had a higher profit. However, the argument states that the number of computers sold was the same and thus, whether or not (A) is true is irrelevant.
(B) The number of people buying PXC computers who also bought PXC computer-related products, such as printers, was larger last year than the previous year.The argument says nothing about other products. The argument is only about computer sales.
(C) Among computer buyers who bought a PXC computer to replace their existing computer, the proportion who were replacing a computer made by a competitor of PXC was greater last year than the previous year. At first this seems like a contender because it makes you think that more people may have bought a more profitable computer because they were replacing their old computers and the argument states that "first-time computer buyers buying PXC home computers typically buy models that cost much less and have a smaller profit margin per computer than do PXC computers bought by people replacing their computers with more powerful models." However, this does not have to be true. Whether or not the buyers previously owned a PXC computer or computer from a competitor is not important.
(D) The proportion of PXC computers bought by first-time computer buyers was smaller last year than the previous year.
This is the correct answer. It must be true that since the same number of computers were sold that more computers were sold to non-first time buyers.
(E) PXC's production costs for its computers were lower last year than they had been the previous year.Profit margins do not change so this directly contradicts the argument.

_________________

"Never, Never, Never give in."

Manager
Manager
User avatar
Joined: 15 Sep 2011
Posts: 182
Location: United States
Concentration: Finance, International Business
WE: Corporate Finance (Manufacturing)
Followers: 1

Kudos [?]: 60 [0], given: 5

Re: First-time computer buyers buying PXC home computers [#permalink] New post 11 Feb 2014, 15:58
If the statements above are true, which of the following is most strongly supported by them?

Conclusion: Last year PXC's profits from computer sales were substantially higher than the previous year
Reasoning: There are two types of computers: low price and high price. Prices have not change, and same number of units were sold. Still, profit is higher. Therefore, the higher price computers sold more this year than last year. Correct answers must be inferred from the stimulus. Incorrect answers are as follows: could be true/likely to be true, exaggerated answers, new information, shell game, or reverse logic

(A) PXC's competitors raised the prices on their computers last year, making PXC computers more attractive to first-time computer buyers. Wrong - This is not true, because stimilus says prices and profit margins for each computer remained unchanged.

(B) The number of people buying PXC computers who also bought PXC computer-related products, such as printers, was larger last year than the previous year. Wrong - New information is provided

(C) Among computer buyers who bought a PXC computer to replace their existing computer, the proportion who were replacing a computer made by a competitor of PXC was greater last year than the previous year. Wrong - New information is out of scope.

(D) The proportion of PXC computers bought by first-time computer buyers was smaller last year than the previous year. Must be true for profit margins to increase.

(E) PXC's production costs for its computers were lower last year than they had been the previous year. Wrong - shell game and not supported by stimulus above. Prices and profits remained unchanged, so costs must have remained unchanged.

IMO D

_________________

A little kudos never hurt anyone. :)

Re: First-time computer buyers buying PXC home computers   [#permalink] 11 Feb 2014, 15:58
    Similar topics Author Replies Last post
Similar
Topics:
Experts publish their posts in the topic To persuade consumers to buy its personal computers for home Bunuel 1 30 Jun 2014, 12:24
To persuade consumers to buy its personal computers for home garimavyas 8 12 May 2011, 07:36
computer ritula 4 07 Feb 2009, 02:41
First-time computer buyers buying PXC home computers sondenso 6 08 May 2008, 01:09
first-time computer buyers buying pxc home computers lan583 5 08 Sep 2006, 12:34
Display posts from previous: Sort by

First-time computer buyers buying PXC home computers

  Question banks Downloads My Bookmarks Reviews Important topics  

Go to page    1   2    Next  [ 21 posts ] 



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®.