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# The value of a product is determined by the ratio of its

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The value of a product is determined by the ratio of its [#permalink]

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19 Jan 2010, 09:27
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57% (02:28) correct 43% (01:27) wrong based on 40 sessions

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The value of a product is determined by the ratio of its quality to its price. The higher the value of a product, the better will be its competitive position. Therefore, either increasing the quality or lowering the price of a given product will increase the likelihood that consumer will select that product rather than a competing one.
Which of the following, if true, would most strengthen the conclusion drawn above?
(A) It is possible to increase both the quality and the price of a product without changing its competitive position.
(B) For certain segments of the population of consumers, higher-priced brands of some product lines are preferred to the lower-priced brands.
(C) Competing products often try to appeal to different segments of the population of consumers.
(D) The competitive position of a product can be affected by such factors as advertising and brand loyalty.
(E) Consumers’ perceptions of the quality of a product are based on the actual quality of the product.
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Re: The value of a product is determined by the ratio [#permalink]

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19 Jan 2010, 16:32
IMO is A , whats the OA?
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19 Jan 2010, 16:46
OA is
[Reveal] Spoiler:
E

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Re: The value of a product is determined by the ratio [#permalink]

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19 Jan 2010, 20:33
SudiptoGmat wrote:
The value of a product is determined by the ratio of its quality to its price. The higher the value of a product, the better will be its competitive position. Therefore, either increasing the quality or lowering the price of a given product will increase the likelihood that consumer will select that product rather than a competing one.
Which of the following, if true, would most strengthen the conclusion drawn above?
(A) It is possible to increase both the quality and the price of a product without changing its competitive position.
(B) For certain segments of the population of consumers, higher-priced brands of some product lines are preferred to the lower-priced brands.
(C) Competing products often try to appeal to different segments of the population of consumers.
(D) The competitive position of a product can be affected by such factors as advertising and brand loyalty.
(E) Consumers’ perceptions of the quality of a product are based on the actual quality of the product.

Has to be E. The potential buyers of the product have to know the quality of the product to determine the value of the product (value = quality/price).
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Re: The value of a product is determined by the ratio [#permalink]

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11 Aug 2010, 01:15
E????? How does it strengthen???
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Re: The value of a product is determined by the ratio [#permalink]

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11 Aug 2010, 02:34
Ne one please explain why E . Though i Chose A
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Re: The value of a product is determined by the ratio [#permalink]

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11 Aug 2010, 02:51
There are two sides of the deal. Producer and customer.

Producer plays with quality & price, so that the product has the best competitive position.

Consumer bases the decision to buy on quality and price perception.

You need some link to connect these two statements. (E) perfectly connects actual quality, set by producer, with its perception by customer.
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Re: The value of a product is determined by the ratio [#permalink]

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11 Aug 2010, 04:10
Yes, this should be E. Part of the stem says, paraphrasing: "if you can increase the quality of a product, consumers will be more likely to buy it". Well, it's not enough to make the product better - consumers need to *know* the product is better. That's what E is saying.
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Re: The value of a product is determined by the ratio [#permalink]

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11 Aug 2010, 04:14
Feel the same: E.
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Re: The value of a product is determined by the ratio [#permalink]

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11 Aug 2010, 09:54
Has to be E, rest are either weakening the argument or not at all important
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Re: The value of a product is determined by the ratio [#permalink]

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08 Sep 2010, 06:03
imo E, A doesnt strengthen or weaken the position
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08 Sep 2010, 11:24
E is the only Answer..It has to be E
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14 Sep 2010, 06:23
i think E should be correct
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Re: The value of a product is determined by the ratio [#permalink]

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14 Sep 2010, 06:48
Looks like (E) to me.

SudiptoGmat wrote:
The value of a product is determined by the ratio of its quality to its price. The higher the value of a product, the better will be its competitive position. Therefore, either increasing the quality or lowering the price of a given product will increase the likelihood that consumer will select that product rather than a competing one.
Which of the following, if true, would most strengthen the conclusion drawn above?

(A) It is possible to increase both the quality and the price of a product without changing its competitive position. This wouldn't really help the argument, as it would undermine the original statement about the ratio of price:quality being the indicator of value.

(B) For certain segments of the population of consumers, higher-priced brands of some product lines are preferred to the lower-priced brands. Directly weakens the argument that lowering price will increase sales.

(C) Competing products often try to appeal to different segments of the population of consumers. Irrelevant

(D) The competitive position of a product can be affected by such factors as advertising and brand loyalty. Advertising and brand loyalty aren't addressed, and this could certainly weaken the argument - other factors besides price and quality can increase your product's competitiveness.

(E) Consumers’ perceptions of the quality of a product are based on the actual quality of the product. In other words, customers will think more highly of a product if its quality is raised - increasing its value. Correct choice.
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Re: The value of a product is determined by the ratio [#permalink]

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14 Sep 2010, 07:26
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Re: The value of a product is determined by the ratio [#permalink]

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14 Sep 2010, 08:30
Here's my justification for E.

(A) It is possible to increase both the quality and the price of a product without changing its competitive position. - The conclusion states you either increase the quality or lower the price, not both. Although you can change both, it's out of scope for the purposes of the conclusion

(B) For certain segments of the population of consumers, higher-priced brands of some product lines are preferred to the lower-priced brands. - This could weaken the conclusion. If some consumers make purchasing decisions purely on higher price then lowering the price will decrease the likelihood of some consumers selecting the product.

(C) Competing products often try to appeal to different segments of the population of consumers. - This is irrelevant to the conclusion. We're not talking about price or quality in this answer.

(D) The competitive position of a product can be affected by such factors as advertising and brand loyalty. - This weakens the conclusion. If other factors affect the competitive position then increasing the quality or decreasing the price could have no effect.

(E) Consumers’ perceptions of the quality of a product are based on the actual quality of the product. - Correct answer. An assumption in the argument is the increase in quality is actually observed and noticed by the consumer. This validates the assumption and therefore strengthens the argument.
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Re: The value of a product is determined by the ratio [#permalink]

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09 Apr 2012, 02:29
shrouded1 wrote:
imo E, A doesnt strengthen or weaken the position

Bang on! it just at best partailly strengthen, whereas consider the case when consumer is not able to understand/feel the better quality then there is no point in improving quality. So E wins IMO for being more direct!
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Re: The value of a product is determined by the ratio   [#permalink] 09 Apr 2012, 02:29
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