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Sales at a local sandwich shop have been declining steadily

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Sales at a local sandwich shop have been declining steadily [#permalink] New post 14 May 2008, 08:48
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A
B
C
D
E

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  5% (low)

Question Stats:

44% (01:53) correct 56% (01:01) wrong based on 15 sessions
Sales at a local sandwich shop have been declining steadily since a health food restaurant opened its doors for business on the same block three months ago. The owner of the sandwich shop concludes that the best way to raise sales back to prior levels is to offer special sandwich prices that compete with the low prices at the health food restaurant.

Which of the following assumptions helps to justify the owner’s conclusion?

A) Local consumers prefer the food at the sandwich shop to the food at the health food restaurant.
B) Sales at the sandwich shop reached an all-time high six months ago.
C) The sandwich shop’s prices are currently higher than those of a similar shop located in a neighboring town.
D) The sandwich shop does not currently offer any healthful food items.
E) The health food restaurant is running its special prices as a temporary promotion and will be raising its prices at the end of the year.

PLEASE EXPLAIN YOUR ANSWERS. hint: I got it wrong thinking its related to pricing of sandwiches.
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Re: CR - SANDWICH SHOPS [#permalink] New post 14 May 2008, 09:13
I got A by POE
A says that people prefer sandwich. If the owner lower price, there by eliminating one consideration for choosing shops, then people should come back.

All pther choices doesnt even fit.

rw6183 wrote:
Sales at a local sandwich shop have been declining steadily since a health food restaurant opened its doors for business on the same block three months ago. The owner of the sandwich shop concludes that the best way to raise sales back to prior levels is to offer special sandwich prices that compete with the low prices at the health food restaurant.

Which of the following assumptions helps to justify the owner’s conclusion?

A) Local consumers prefer the food at the sandwich shop to the food at the health food restaurant.
B) Sales at the sandwich shop reached an all-time high six months ago.
C) The sandwich shop’s prices are currently higher than those of a similar shop located in a neighboring town.
D) The sandwich shop does not currently offer any healthful food items.
E) The health food restaurant is running its special prices as a temporary promotion and will be raising its prices at the end of the year.

PLEASE EXPLAIN YOUR ANSWERS. hint: I got it wrong thinking its related to pricing of sandwiches.
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Re: CR - SANDWICH SHOPS [#permalink] New post 14 May 2008, 09:39
i get A as well..assumption is people will comeback because they like the taste of the sandwich
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Re: CR - SANDWICH SHOPS [#permalink] New post 14 May 2008, 09:59
A is the only plausible option.

i reached my answer by POE.

if this is the correct answer ...i can explain further...

thanks

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Re: CR - SANDWICH SHOPS [#permalink] New post 14 May 2008, 10:39
I got A as well.

The local sandwich shop proposes to lower prices to compete with the health food shop. In order for this to work the customers still have to want to choose the local sandwich shop.

ex. The local shop sells sandwiches that taste like crap and people buy it because it's the only option. The health food shop moves in with good sandwiches. Even if the local shop reduces the price of the crap sandwiches people would still eat at the health food shop.
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Re: CR - SANDWICH SHOPS [#permalink] New post 14 May 2008, 13:32
yep, A for me as well.
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Re: CR - SANDWICH SHOPS [#permalink] New post 14 May 2008, 13:48
A here as well. If prices are equal, what other factor would other people consider when deciding which sandwich to purchase? Taste/quality, which consumers prefer local shop over health shop.

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Re: CR - SANDWICH SHOPS [#permalink] New post 14 May 2008, 17:41
OA IS A!
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Re: CR - SANDWICH SHOPS [#permalink] New post 14 May 2008, 18:39
rw6183 wrote:
Sales at a local sandwich shop have been declining steadily since a health food restaurant opened its doors for business on the same block three months ago. The owner of the sandwich shop concludes that the best way to raise sales back to prior levels is to offer special sandwich prices that compete with the low prices at the health food restaurant.

Which of the following assumptions helps to justify the owner’s conclusion?

A) Local consumers prefer the food at the sandwich shop to the food at the health food restaurant.
B) Sales at the sandwich shop reached an all-time high six months ago.
C) The sandwich shop’s prices are currently higher than those of a similar shop located in a neighboring town.
D) The sandwich shop does not currently offer any healthful food items.
E) The health food restaurant is running its special prices as a temporary promotion and will be raising its prices at the end of the year.

PLEASE EXPLAIN YOUR ANSWERS. hint: I got it wrong thinking its related to pricing of sandwiches.


Well, after reading this, I assumed that the owner is lowering prices just to compete with the healthy sandwich shop, even though that's not what consumers are going after. I therefore eliminated B, C and E because they deal with sales and pricing. I focused on A and D and chose A because D doesn't show a significant enough reason as A does of why the sandwich owner would reach such a conclusion.
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Re: CR - SANDWICH SHOPS [#permalink] New post 19 Jun 2011, 01:51
Can someone please explain why E is incorrect???
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Re: CR - SANDWICH SHOPS [#permalink] New post 19 Jun 2011, 02:02
siddhans wrote:
Can someone please explain why E is incorrect???


E) The health food restaurant is running its special prices as a temporary promotion and will be raising its prices at the end of the year.
Although low prices could be the stimulus behind the customers move to health food restaurant, we can't be 100% sure of that. People may be going to health food restaurant for better food. If they are going for healthier food, then raising or reducing prices will have no effect in reinstating the earlier customer base in the sandwich shop.

A) Local consumers prefer the food at the sandwich shop to the food at the health food restaurant.
This statement says that people prefer food at sandwich shop, thus, there must be other factor that caused the reduction in customer. It could be prices. Thus, reducing prices can have effect.

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Re: CR - SANDWICH SHOPS [#permalink] New post 19 Jun 2011, 02:09
fluke wrote:
siddhans wrote:
Can someone please explain why E is incorrect???


E) The health food restaurant is running its special prices as a temporary promotion and will be raising its prices at the end of the year.
Although low prices could be the stimulus behind the customers move to health food restaurant, we can't be 100% sure of that. People may be going to health food restaurant for better food. If they are going for healthier food, then raising or reducing prices will have no effect in reinstating the earlier customer base in the sandwich shop.

A) Local consumers prefer the food at the sandwich shop to the food at the health food restaurant.
This statement says that people prefer food at sandwich shop, thus, there must be other factor that caused the reduction in customer. It could be prices. Thus, reducing prices can have effect.



Okay, I see what you are saying but still not 100% satisfied...Doesnt E also partially say that people prefer food at sandwich shop and not at the healthy restaurant so if the sandwich shop reduces the price then because they make tasty sandwiches people will return back?? Sorry but I am a little confised :roll:
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Re: CR - SANDWICH SHOPS [#permalink] New post 19 Jun 2011, 02:32
siddhans wrote:
Okay, I see what you are saying but still not 100% satisfied...Doesnt E also partially say that people prefer food at sandwich shop and not at the healthy restaurant so if the sandwich shop reduces the price then because they make tasty sandwiches people will return back?? Sorry but I am a little confised :roll:


**********************************
E) The health food restaurant is
running its special prices as a temporary promotion and
will be raising its prices at the end of the year.
************************************

I don't think E says anything about sandwich shop or people's preference. It is just giving us information/fact about Health food restaurants. It says health food prices are low but will increase in future. That's it.

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Re: Sales at a local sandwich shop have been declining steadily [#permalink] New post 16 Apr 2012, 11:32
Sales at a local sandwich shop have been declining steadily since a health food restaurant opened its doors for business on the same block three months ago. The owner of the sandwich shop concludes that the best way to raise sales back to prior levels is to offer special sandwich prices that compete with the low prices at the health food restaurant.

Which of the following assumptions helps to justify the owner’s conclusion?
A) Local consumers prefer the food at the sandwich shop to the food at the health food restaurant.
B) Sales at the sandwich shop reached an all-time high six months ago.
C) The sandwich shop’s prices are currently higher than those of a similar shop located in a neighboring town.
D) The sandwich shop does not currently offer any healthful food items.
E) The health food restaurant is running its special prices as a temporary promotion and will be raising its prices at the end of the year.

If A is true(Local consumers prefer the food at the sandwich shop) then consumers are going to come back to sandwich shop anyway; why decrease price? A is not a necessary assumption to conclude "the best way to raise sales back to prior levels is to offer special sandwich prices that compete with the low prices at the health food restaurant."

I think E is not necessary either but it comes closest.

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Re: Sales at a local sandwich shop have been declining steadily   [#permalink] 16 Apr 2012, 11:32
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