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Please rate my Analysis of Argument .... [#permalink]
21 Aug 2011, 06:06
"Davis Technologies, a computer-chip maker, could solve its problem of declining sales by dropping its prices. This would make Davis better able to compete in the highly competitive computer chip market. The sales of chips would increase and this would substantially boost Davis' market share."
How would you rate the accuracy of the above statement? Support your position with reasons and examples
The author presents a claim that Davis Technologies, a computer-chip maker, could solve its problem of declining sales by dropping its prices.The reduced prices will increase the sales and will ultimately lead to a boost in Davis market share. Although increasing sales could be attributed to decreasing price but to claim with surety that reduced prices will lead Davis to compete in a better manner is flawed. Though the author's argument may well have its merit, the author presents a poorly reasoned argument based on several questionable assumption and premises that on the basis of the sole evidences cannot be accepted to be true.
The primary issue with the author's claim lies in the unsubstantiated premises . The author take it for granted that reduced prices will make an organisation more competitive. The argument fails to see that reduced prices will lead to reduced profits if the cost remains constant and hence instead of improving Davis position could further damage the company balance sheets.The author's premise,which is the basis of the his assumption fails to provide legitimate evidences and hence cannot be considered in its current form.
In addition, the author make assumptions which remain largely unproven.For instance, low sales of Davis chips may well be because of poor service life or poor after sales service . The company's lagging technology on the advanced chip front may also be a cause for the decline.The author weakens his argument by making assumptions and failing to provide explication of the link between poor sales and higher prices he assumes exists.
While the author reasoning may contain several key flaws in his assumptions or premises , it will be wrong to say that the entire argument is without its base.However,to strengthen his argument the author needs to make a cost analysis of the product to prove that reduced prices will not hurt overall profits.He must also look into other factors which are leading to a reduced market share .The statement could be strengthened if the author provides the above mentioned evidences and look into the issue closely considering other factors as well.
In sum , the statement presented lacks evidences and examples to be considered as true. If the author truly hopes to make the readers accept the claim he must restructure the argument, fix the flaws in his reasoning,explicate the assumptions and provide evidences for the premises.However in the current form the fallacies render the claim as unacceptable.
I am done with my GMAT and got an AWA score of 5.5