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12 Days of Christmas GMAT Competition 2025 - Day 5: Over the last two

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Rahilgaur

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20 Dec 2025, 05:26

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[quote="Bunuel"]Over the last two years, multiple streaming platforms have introduced ad-supported subscription tiers at lower prices, aiming to attract price-sensitive customers and generate ad revenue. Despite these lower-cost options and increased marketing, the number of new subscribers has stagnated. Surprisingly, surveys reveal that many non-subscribers cite price as their main reason for not joining, even though ad-supported plans are significantly cheaper than traditional ones.

Descrepancy - even though the prices of subscriptions were reduced, non- subscribers still think that prices are high.

Reason could be something which makes the non subscribers feel that prices are not as per value.

Which of the following, if true, would best help resolve the discrepancy described in the report?

A. Many non-subscribers associate ad-supported streaming plans with low content quality or limited access, leading them to dismiss these options as poor value - resolves the discrepancy as non subscribers method to evaluate is explained. And supports the idea why non subscribers may find the fees still high. Answer A
B. Viewers who are highly sensitive to advertising often opt for more expensive, ad-free tiers rather than ad-supported ones. - Not relevant, since price is mainly the cited reason.
C. Ad-supported plans tend to generate lower revenue per user than ad-free plans, making them less profitable for the platform overall. - Not relevant
D. The average number of hours streamed per week has increased among existing subscribers, particularly in ad-supported tiers. - not relevant, nothing about non subscribers.
E. Several competing platforms have recently introduced exclusive content available only to premium (ad-free) subscribers. Again not relevant at all.

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20 Dec 2025, 05:43

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IMO A!

The discrepancy we have to resolve is the following
"Despite these lower-cost options and increased marketing, the number of new subscribers has stagnated (and many of them cited price as a reason for not subscribing)".

==> Hence the price and something else are preventing them to subscript

B) Does not propose another cause

C) We are not talking about revenues but new customers

D) The average number of hours streamed per week is irrelevant

E) It could potentially affect only people who are in any case willing to pay a high fee, so irrelevant

A) Proposes another argument that supports the discrepancy, hence not only prices but also concerns on the quality of the service!

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20 Dec 2025, 06:01

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A?

The question talks about new subscribers not coming in despite lower priced options available. Only option A seems to be talking about non-subscribers and why they do not like ad-supported lower tier options.

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Which of the following, if true, would best help resolve the discrepancy described in the report?

A. Many non-subscribers associate ad-supported streaming plans with low content quality or limited access, leading them to dismiss these options as poor value.
(Even though there are cheaper plans,but many people still think those plans are not worth it.
They might believe that adsupported plans have fewer options or too many ads, so they choose to ignore them) Correct

B. Viewers who are highly sensitive to advertising often opt for more expensive, ad-free tiers rather than ad-supported ones.
(It only focuses on existing subscribers’ preferences and not not non-subscribers) Wrong

C. Ad-supported plans tend to generate lower revenue per user than ad-free plans, making them less profitable for the platform overall.
(It only discusses platform profitability. It is irrelevant to the argument) Wrong

D. The average number of hours streamed per week has increased among existing subscribers, particularly in ad-supported tiers.
(It only concerns the usage behavior amog existing subscribers and not on why people don’t join) Wrong

E. Several competing platforms have recently introduced exclusive content available only to premium (ad-free) subscribers.
(It does not explain the cited discrepancy) Wrong

Kinshook

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20 Dec 2025, 06:46

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Over the past 2 years, multiple streaming platforms have introduced ad-supported subscription tiers at lower prices, aiming to attract price-sensitive customers and generate ad revenue.

Despite these lower-cost options and increased marketing, the number of new subscribers has stagnated.

Surprisingly, surveys reveal that many non-subscribers cite price as their main reason for not joining, even though ad-supported plans are significantly cheaper than traditional ones.

Objective : Explain the discrepancy.

Thinking: It may be possible that lower price options are not considered valuable by subscribers or are considered as poor quality ones.

Options:

A. Matches our reasoning. Keep it.

B. The argument is concerned with price-sensitive customers and NOT about those sensitive to advertising and willing to pay higher prices. Incorrect

C. The argument is NOT about profitability of the platform and revenues generated. Incorrect

D. The argument is concerned with the number of new subscribers and NOT about the average number of hours streamed by existing subscribers. Incorrect

E. The argument is concerned with the number of new subscribers and NOT about contents made available for premium (ad-free) subscribers. Incorrect

IMO A

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20 Dec 2025, 06:55

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We have a contradiction - if companies are now introducing cheaper plans that show adds to attract price-sensitive customers, then why is it that the number of current subscribers is constant? Plus, why is it that those who still opt not to subscribe, are citing price as the biggest factor influencing their decision.

To resolve such a discrepancy, a few alternatives will work:

- Perhaps those who are still non-subscribers consider the very fact that these platforms charge anything in the first place, as a hinderance.
- Perhaps, their idea of how customers assign value to such platforms is different from how these platforms perceive things. The platforms themselves feel the cost-factor will be negated with these cheaper plans, but people may consider the presence of these advertisements as reducing the value of the platform, thus the reduction in cost - when accompanied with a reduction in service quality - may not do enough to encourage a non-subscriber to convert.

Let us see the options:

- Option A: Oh, well, this is exactly what my second line of reasoning says, isn't it? We can freeze this for now.

- Option B: We're not talking about viewers who opt for more expensive plans, but those who don't subscribe at all. This is irrelevant.

- Option C: We aren't dealing with anything to do with the streaming platform's business decision here, as we're comparing new subscribers, not revenue.

- Option D: If this shift in business strategy has caused existing subscribers to increase their streaming hours, that doesn't say anything about the addition of new subscribers. So please eliminate.

- Option E: Even if the competing platforms are doing a better job at converting non-subscribers, this doesn't comment on the reasoning given by these non-subscribers; that they find platforms too expensive even after the ad-tier introduction. So, the same consideration would discourage these non-subscribers from subscribing to other ad-tier platforms.

Bunuel

Over the last two years, multiple streaming platforms have introduced ad-supported subscription tiers at lower prices, aiming to attract price-sensitive customers and generate ad revenue. Despite these lower-cost options and increased marketing, the number of new subscribers has stagnated. Surprisingly, surveys reveal that many non-subscribers cite price as their main reason for not joining, even though ad-supported plans are significantly cheaper than traditional ones.

Which of the following, if true, would best help resolve the discrepancy described in the report?

A. Many non-subscribers associate ad-supported streaming plans with low content quality or limited access, leading them to dismiss these options as poor value
B. Viewers who are highly sensitive to advertising often opt for more expensive, ad-free tiers rather than ad-supported ones.
C. Ad-supported plans tend to generate lower revenue per user than ad-free plans, making them less profitable for the platform overall.
D. The average number of hours streamed per week has increased among existing subscribers, particularly in ad-supported tiers.
E. Several competing platforms have recently introduced exclusive content available only to premium (ad-free) subscribers.

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20 Dec 2025, 07:01

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Bunuel

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A: Correct: This option tells us the many subscribers won't even prefer these streaming platforms and hence despite lower costs won't subscribe to these platforms.

B: Incorrect: We know that the number of new subscribers stagnated. If viewers who are highly sensitive to advertising, they could have subscribed to a different tier.

C: Incorrect: Out of scope. We are looking for a reason why the numbers stagnated.

D: Incorrect : Irrelevant and out of scope to the discrepancy we are trying to resolve.

E: Incorrect: If this were true, non subscribers could have subscibed to ad-free tiers. Eliminate.

Option A

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20 Dec 2025, 07:23

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Discrepancy: if cheaper plans exist, why non-subscribers still cite price as the reason for not subscribing.

A Correct. If non-subscribers think ad-supported plans have lower content quality or limited access, then they see them as poor value for the price. This resolves the discrepancy because they dismiss the cheaper tie.

B Talks about viewers who are already subscribers choosing ad-free over ad-supported. The discrepancy is about non-subscribers.

C Profitability for the platform is irrelevant to resolve the discrepancy.

D Again, discrepancy is about non-subscribers.

E Exclusive content for premium might make ad plans seem less appealing, but the discrepancy is about price being cited as reason for not joining at all.

IMO A

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20 Dec 2025, 07:25

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A -> Correct. Since the non-subscribers don't want to watch low quality content and dismiss the choice of ad supported plans, they haven't subscribed because obviously think the ad free plans are costly.
B -> This is probably for existing users who prefer ad free experience
C -> This cannot be a reason for the non-subscribers
D -> Again refers to the existing subscribers
E -> This would not justify why the non-subscribers don't want to use the with-ad plans

Option A

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kapoora10

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20 Dec 2025, 07:33

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Let's check each statement:
A=> This explains that the perceived value of the product is the issue not the price. Keep for now
B => Talks about existing subscribers not non- subscribers. Eliminate.
C=>Revenue and profits are irrelevant here. Eliminate.
D=> Information about existing subscribers gives no insight on generation of new ones. Eliminate.
E=> this does not explain why price sensitive subscribers still do not sign up as the exclusive is only on premium product. Eliminate.

Answer =>A

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20 Dec 2025, 07:36

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answer A

a explains why subscriptions are still low. people are thinking the content and access will be limited

b. doesn't explain why total subscriptions are down.
c. doenst explain subscription just why revenue is down
d. this would explect to increase numbers
e this doesnt explain why subscription are low

Bunuel

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20 Dec 2025, 07:42

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We are given that:
1. Many streaming platforms introduced ad supported cheaper plan
2. This is expected to give acces to price sensitive customers
3. New subscribers have stagnated

As per the options:
A. Customers think restricted access and lower quality does not justify even the lower price. Good option to consider.
B. Ad-sensitive client are current subscribers. This does not explain why stagnation in new subscribers, hence no
C. Platform profitability cannot be linked to addition of new customers, hence no
D. Increased viewing hours of current customers may explain higher quality of content but does not explain why new ones are not joining, hence no
E. Exclusive content on some platforms may be attracting newer clients but does not explain stagnation of addition of new price sensitive customers

Best option is A.

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20 Dec 2025, 07:47

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We have to explain why even after introducing low cost ad included options & higher advertising, the new subscribers stagnated.

C) We are not concerned about the profitability, rather the no of subscribers. Irrelevant
D) Again we aren't concerned about the increase in streaming hrs of existing subscribers, rather than new subscribers joining. Irrelevant
E) Other platforms have introduced exclusive content to ad free/premium subscribers, still doesnt explain why they had not signed up for lower cost alternative for this particular platform. If other platforms would have also introduced low cost alternative, then this might be the reason but not now. Incorrect
B) Then it should have made people to have subscribed, but that was not the case. Incorrect

A) Perfectly explains why even after getting a low cost alternative people didnt sign up coz they considered it of low value & low quality and didnt sign up

Ans A

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20 Dec 2025, 07:56

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A. Relevant as this tells us that even if cheaper plans exist people assume that they arent of good value and dont subscribe. They also cite price as the reason for not subscribing here.
B. Irrelevant as this is talking about present subscribers and not non-subscribers.
C. Irrelevant as this statement is talking about platform profits and not about consumer behavior
D. Irrelevant as this is talking about usage and not regarding how subscription decisions are taken
E. Irrelevant as this explains about ad-free plans being more attractive and not about ad-supported plans. It also doesent explain the price factor as a reason

A.

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20 Dec 2025, 07:57

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The paradox: Why are people who claim to be stopped by price not signing up for the new, cheaper plans that were designed for them?

A. Correct. It directly explains the non-subscriber's mindset. It tells us why a low price is not sufficient enough to attract them.

B. Incorrect. This explains the behavior of existing or newly convinced subscribers who are choosing between tiers.

C. Incorrect. This is completely irrelevant. We're not concerned with the profitability.

D. Incorrect. This choice describes the behavior of existing subscribers.

E. This is interesting. It suggests a reason why the ad-free plan is more attractive, but it doesn't fully explain why the ad-supported plan is not able to attract non-subscribers. Incorrect.

Option A

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20 Dec 2025, 07:58

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A Right answer. If non-subscribers don't perceive ad-supported plans as true substitutes for regular plans, even though the price is lower, they don't view these plans as worth buying.

B It talks about existing subscribers' preferences, not why non-subscribers don't join.

C Platform profitability doesn't explain subscriber stagnation.

D Usage among existing subscribers doesn't address non-subscription behavior.

E It explains premium appeal, but not why cheaper plans fail to attract price-sensitive users.

Answer A

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20 Dec 2025, 08:07

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Our reasoning goes as follows: cheaper plans with ads => more price-sensitive customers. However, we saw no increase, and moreover, the potential customers say that the price is the reason.
Since the price has substantially gone down, we need to find another factor that prevents these respondents from joining and that makes then cite price as the reason.

A) This is not a bad option, since it would build the following logic: I'd like to join the platform => they have cheap plans, nice! => oh wait they have ads, it means it's gonna suck => nah it's not worth the money. But for this logic to work, we need to actually have some more info about how the price perception works on the market, and whether such a price for low-tier access is actually reasonable (because it may be low for this streaming service but still too high for the customers).

B) This makes sense, since introducing these cheaper plans the company did two things, not one: minus price, plus ads. This means that while some people should've been attracted to join for cheapness, others could be scared away by ads. And then, looking at the plans without ads, the prices are still very steep! And that would mean that those poor non-subscribers who were complaining about the price didn't really disagree with the cheap tariff - they didn't even consider it for the ads, and all the others are indeed too pricy.

C) This is irrelevant since we're not analyzing what the company'd benefits are.

D) Seems not bad, as it does epxlain that the new plan introduction did work in some way - but it doesn't cover these new subscribers we're talking about, so it isn't not our option.

E) Since we have no info about their pricing and we can assume it's quite steep, this wouldn't sway our already frugal customers, so this is wrong.

Therefore, it looks like the best option is B.

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20 Dec 2025, 08:21

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The discrepancy is: if there's a cheaper option, why is price still the cited barrier.

A This option says that many non-subscribers think ad-supported plans have low quality or limited access. So they dismiss them as poor value. They would compare price relative to value. Correct answer.

B This option is about subscribers. Not relevant to why non-subscribers cite price as barrier.

C This option is about profitability to platform. It's irrelevant to consumer reasoning.

D This option is about existing subscribers' behavior. It's irrelevant to why non-subscribers don't join.

E Exclusive content for premium might make ad plans seem worse, but doesn't directly explain why non-subscribers cite price as main reason.

The answer is A

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20 Dec 2025, 08:43

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A CORRECT. "price is the main reason" = price for the acceptable, premium tier. Non-subscribers ignore the cheaper tier because they perceive it as inferior, so their price objection is actually about the price of the tier they would actually want.

B It explains behavior of people who already subscribe, not non-subscribers.

C This refers to platform profitability, not to subscriber stagnation.

D This refers to usage by existing subscribers, it's irrelevant to new sign-ups.

E This explains premium preference but not why cheaper plans fail to attract price-sensitive users.

The correct answer is A

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20 Dec 2025, 08:45

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Context: Streaming platforms added cheaper ad-supported plans
Premise: New subscriptions have stopped and non-subscribers still say that the price is a barrier
Conclusion: Price is perceived as barrier because ads-plan are seen as poor value despite being cheaper
Logical gap: Assumes that lowering the price would remove the barrier

Evaluaitng choices
A) This resolves the logical gap that people still see price as barrier when prices are lower. The non subsribers do not view these ad plans as worthy for the money paid.
B) this option says about people choosing expensive plans, not about nonsubsribers
C)This is about revenue generation and not about the oberved behaviour of users
E) This is irrelevant as this talks about preference for premium plans by competing platforms and do not fill the gap in the argument

Hence answrr is A

Bunuel

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