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

It is currently 25 Nov 2014, 21:30

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

Over the past five years, the price gap between name-brand

  Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
TAGS:
SVP
SVP
User avatar
Joined: 28 May 2005
Posts: 1743
Location: Dhaka
Followers: 6

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

Over the past five years, the price gap between name-brand [#permalink] New post 17 Dec 2005, 10:40
00:00
A
B
C
D
E

Difficulty:

(N/A)

Question Stats:

100% (00:00) correct 0% (00:00) wrong based on 1 sessions
Over the past five years, the price gap between name-brand cereals and less expensive store-brand cereals has become so wide that consumers have been switching increasingly to store brands despite the name brands’ reputation for better quality. To attract these consumers back, several manufacturers of name-brand cereals plan to narrow the price gap between their cereals and store brands to less than what it was five years ago.

Which of the following, if true, most seriously calls into question the likelihood that the manufacturers’ plan will succeed in attracting back a large percentage of consumers who have switched to store brands?

A. There is no significant difference among manufacturers of name-brand cereals in the prices they charge for their products.
B. Consumers who have switched to store-brand cereals have generally been satisfied with the quality of those cereals.
C. Many consumers would never think of switching to store-brand cereals because they believe the name brand cereals to be of better quality.
D. Because of lower advertising costs, stores are able to offer their own brands of cereals at significantly lower prices than those charged for name-brand cereals.
E. Total annual sales of cereals—including both name-brand and store-brand cereals—have not increased significantly over the past five years.
_________________

hey ya......

VP
VP
avatar
Joined: 06 Jun 2004
Posts: 1061
Location: CA
Followers: 2

Kudos [?]: 35 [0], given: 0

 [#permalink] New post 17 Dec 2005, 11:57
This is a clear B

If consumers generally perceive the store brands to be inferior of quality, and are satisified after the switch, they are less likely to switch back to the name brands just because the price gap has lessened.

Notice its the price gap....name brand cereals still cost more than store brands do.
Senior Manager
Senior Manager
avatar
Joined: 03 Nov 2005
Posts: 398
Location: Chicago, IL
Followers: 3

Kudos [?]: 25 [0], given: 17

 [#permalink] New post 17 Dec 2005, 21:17
B. If consumers are actually more than satisfied with the quality of less expensive store-brand cereal, reduction in the price of higher-priced cereals probably won't make them change their mind.
_________________

Hard work is the main determinant of success

Director
Director
avatar
Joined: 09 Jul 2005
Posts: 595
Followers: 2

Kudos [?]: 23 [0], given: 0

 [#permalink] New post 18 Dec 2005, 06:52
Yes, B is the only answer choice that makes a bit sense.
SVP
SVP
User avatar
Joined: 28 May 2005
Posts: 1743
Location: Dhaka
Followers: 6

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

 [#permalink] New post 19 Dec 2005, 03:25
very good job. OA is indeed B.
_________________

hey ya......

SVP
SVP
User avatar
Joined: 16 Oct 2003
Posts: 1816
Followers: 4

Kudos [?]: 42 [0], given: 0

 [#permalink] New post 19 Dec 2005, 08:56
B. Satisfactory quality and lower price. Go local.
  [#permalink] 19 Dec 2005, 08:56
    Similar topics Author Replies Last post
Similar
Topics:
Over the past five years, the price gap between name-brand Jp27 4 24 Oct 2012, 04:40
Over the past five years, the price gap between name-brand ajitsah 1 13 May 2010, 03:51
4 Over the past five years, the price gap between name-brand vaivish1723 7 30 Jun 2009, 22:59
Over the past five years, the price gap between name-brand apollo168 15 04 Sep 2006, 20:54
Over the past five years, the price gap between name-brand gamjatang 2 19 Dec 2005, 19:25
Display posts from previous: Sort by

Over the past five years, the price gap between name-brand

  Question banks Downloads My Bookmarks Reviews Important topics  


cron

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®.