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Marketing strategists at a major video retailer ...

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Director
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Status: 1,750 Q's attempted and counting
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Marketing strategists at a major video retailer ... [#permalink] New post 04 Oct 2013, 07:16
00:00
A
B
C
D
E

Difficulty:

  35% (medium)

Question Stats:

58% (02:40) correct 42% (01:52) wrong based on 107 sessions
Marketing strategists at a major video retailer are discussing ways to
increase revenues by boosting mid-week DVD rentals, which generally
fall far below weekend rentals. One plan to accomplish this is to extend
the return date for DVDs rented between Monday and Wednesday so
that customers may keep them until Friday. Since more customers will
return to the store on Fridays, they will be also be more likely to rent
again for the weekend.

Which of the following, if true, would indicate the most serious weakness
in the plan above?

(A) The number of clerks currently employed by the video retailer is not
sufficient to handle a significant increase in business on Monday, Tuesday,
and Wednesday.
(B) Customers who are lured by extended return dates for mid-week DVD
rentals are much less likely than the average customer to rent a DVD on Friday.
(C) Even if the video retailer increases its mid-week rentals, some customers
will continue to rent only on Fridays.
(D) The video retailer currently offers two-day rentals, so the plan would not
provide an additional inducement to rent DVDs on Wednesday.
(E) The video retailer would rent more DVDs by extending return dates on
Friday and Saturday rentals than on Monday through Wednesday rentals.

Source: GMAT Hacks - 011513
OE to follow
[Reveal] Spoiler: OA

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Re: Marketing strategists at a major video retailer ... [#permalink] New post 18 Oct 2013, 12:43
Why B is right?
If this change will be implemented - mid-weak customers will only add to rent in Friday, even though less than average customer. This answer can be right only if we assume that number of average friday customers will decrease, hence dropping the revenues.
Let's see:
Current situation:
M - M new customers rent / Sn+St customers return / no re-rent
T - T new customers rent / Sn+M customers return / no re-rent
W - W new customers rent / M+T customers return / no re-rent
Th - Th new customers rent / T+W customers return / no re-rent
F - F new customers rent / W+Th return / rent for the weekends
St - St new customers rent / Th+F return /rent for the weekends
Sn - Sn new customers rent / F+St return / no re-rent

New situation:
M - MA new customers rent / Sn+St customers return
T - TA new customers rent / Sn+M2 customers return
W - WA new customers rent / M2+T2 customers return
Th - ThA new customers rent / T2+W2 customers return
F - FB new customers rent / W3+Th3 return
St - StA new customers rent / Th2+F2 return
Sn - SnA new customers rent / F2+St2 return

Where X2 < X1, and X3 > X1 > X2, hence FB > F. Even if slightly.
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Re: Marketing strategists at a major video retailer ... [#permalink] New post 19 Oct 2013, 14:48
Expert's post
avohden wrote:
Marketing strategists at a major video retailer are discussing ways to
increase revenues by boosting mid-week DVD rentals, which generally
fall far below weekend rentals. One plan to accomplish this is to extend
the return date for DVDs rented between Monday and Wednesday so
that customers may keep them until Friday. Since more customers will
return to the store on Fridays, they will be also be more likely to rent
again for the weekend.

Which of the following, if true, would indicate the most serious weakness
in the plan above?

(A) The number of clerks currently employed by the video retailer is not
sufficient to handle a significant increase in business on Monday, Tuesday,
and Wednesday.
(B) Customers who are lured by extended return dates for mid-week DVD
rentals are much less likely than the average customer to rent a DVD on Friday.
(C) Even if the video retailer increases its mid-week rentals, some customers
will continue to rent only on Fridays.
(D) The video retailer currently offers two-day rentals, so the plan would not
provide an additional inducement to rent DVDs on Wednesday.
(E) The video retailer would rent more DVDs by extending return dates on
Friday and Saturday rentals than on Monday through Wednesday rentals.

Source: GMAT Hacks - 011513
OE to follow


I have to say with kvazar that I am not a fan of this question's setup. That said, there are questions on the GMAT where the least bad answer is, by default, correct.

For this question, we've got to focus on the conclusion regarding boosting mid-week rentals. Since the plan to accomplish this involves enticing mid-week renters by allowing them to return rentals on Friday in order to rent more for the weekend (presumably enticing because it's just one trip), the argument assumes that mid-week renters want to rent again on Fridays.

That's why
[Reveal] Spoiler:
B
is the least bad answer. If true, it explains why the proposed plan will not boost mid-week rentals.

All this is moot, though, thanks to Netflix and Redbox! When's the last time you rented a video? :lol:
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Joined: 28 Jul 2013
Posts: 1
Concentration: Human Resources, Technology
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Kudos [?]: 5 [0], given: 12

Re: Marketing strategists at a major video retailer ... [#permalink] New post 23 Oct 2013, 02:02
Why cant D be the answer?
It explains why customers would not be interested to rent and it doesnt provide any extra benefits.Hence, the midweek revenues would not increase in turn
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: 20

Kudos [?]: 252 [0], given: 629

Re: Marketing strategists at a major video retailer ... [#permalink] New post 23 Oct 2013, 07:01
Official Explanation

Answer: B
This is a weaken question. The plan's goal is to increase revenues; the method of doing so is to increase mid-week DVD rentals. The plan appears to rest of two premises: Extended return dates will bring in more customers during the week, and those customers will rent again on Friday when they return their mid-week rentals. To attack the argument, we only need to attack one of those two claims. Consider each choice in turn:

(A) This isn't relevant. If the plan is implemented, more clerks could be hired.
(B) This is correct. The argument rests on the claim that mid-week renters will rent again on Friday. This choice suggests that that is unlikely.
(C) This doesn't matter. The argument is concerned with those who do rent during the week.
(D) This doesn't directly weaken the argument, which relies on the inducement to renters on Monday and Tuesday, as well.
(E) This is outside the scope of the argument, which is limited to whether the plan under consideration would be effective, not whether it is the most effective possible plan.

Hope it helps. :lol:
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Re: Marketing strategists at a major video retailer ...   [#permalink] 23 Oct 2013, 07:01
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