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A major retail clothing chain hopes to improve its earnings with heavy

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Joined: 08 Jan 2018
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A major retail clothing chain hopes to improve its earnings with heavy  [#permalink]

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New post 18 Feb 2018, 11:34
1
2
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A
B
C
D
E

Difficulty:

  45% (medium)

Question Stats:

66% (01:51) correct 34% (01:56) wrong based on 272 sessions

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I want to ask a question. The patterns in this question look weird. A talks about the belief while the pattern is about the long-term vs short-term.


A major retail clothing chain hopes to improve its earnings with heavy promotion of their logo-branded merchandise during the holiday season. The promotion costs will decrease its profit margin in the short term, but because the brand has high status appeal the corporate office believes that customers will want to show off their affiliation. Over the long term, the chain anticipates that the new buyers drawn by the promotion will become repeat customers.

In evaluating the plan’s chances of success, it would be most useful to know which of the following?

A Whether the chain’s status appeal is as strong as the corporate office believes

B Whether the promotion will be developed in-house

C Whether some of the retailer’s merchandise will feature multiple small logos, or one large one

D Whether the chain will be able to offset the costs of the promotion and maintain its profit margin while the promotion runs

E Whether a different tactic might allow the chain to increase its profitability while maintaining constant or diminished earnings

ready4gmat
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Re: A major retail clothing chain hopes to improve its earnings with heavy  [#permalink]

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New post 18 Feb 2018, 15:03
aaba wrote:
I want to ask a question. The patterns in this question look weird. A talks about the belief while the pattern is about the long-term vs short-term.

A major retail clothing chain hopes to improve its earnings with heavy promotion of their logo-branded merchandise during the holiday season. The promotion costs will decrease its profit margin in the short term, but because the brand has high status appeal the corporate office believes that customers will want to show off their affiliation. Over the long term, the chain anticipates that the new buyers drawn by the promotion will become repeat customers.

In evaluating the plan’s chances of success, it would be most useful to know which of the following?

A Whether the chain’s status appeal is as strong as the corporate office believes

B Whether the promotion will be developed in-house

C Whether some of the retailer’s merchandise will feature multiple small logos, or one large one

D Whether the chain will be able to offset the costs of the promotion and maintain its profit margin while the promotion runs

E Whether a different tactic might allow the chain to increase its profitability while maintaining constant or diminished earnings


ready4gmat



IMO OA is A
Important message is below.
'but because the brand has high status appeal the corporate office believes that customers will want to show off their affiliation'
So I chose A

B Whether the promotion will be developed in-house
-> Do not need to think about 'developed in house'
C Whether some of the retailer’s merchandise will feature multiple small logos, or one large one
-> logo size is not important.
D Whether the chain will be able to offset the costs of the promotion and maintain its profit margin while the promotion runs
-> The passage said during the holiday season, a major retail clothing chain know that profit will be damaged, but the chain think it is wotrh to do it.
E Whether a different tactic might allow the chain to increase its profitability while maintaining constant or diminished earnings
-> Similar reason as D
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Re: A major retail clothing chain hopes to improve its earnings with heavy  [#permalink]

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New post 28 Feb 2018, 09:06
HG0815 wrote:
aaba wrote:
I want to ask a question. The patterns in this question look weird. A talks about the belief while the pattern is about the long-term vs short-term.

A major retail clothing chain hopes to improve its earnings with heavy promotion of their logo-branded merchandise during the holiday season. The promotion costs will decrease its profit margin in the short term, but because the brand has high status appeal the corporate office believes that customers will want to show off their affiliation. Over the long term, the chain anticipates that the new buyers drawn by the promotion will become repeat customers.

In evaluating the plan’s chances of success, it would be most useful to know which of the following?

A Whether the chain’s status appeal is as strong as the corporate office believes

B Whether the promotion will be developed in-house

C Whether some of the retailer’s merchandise will feature multiple small logos, or one large one

D Whether the chain will be able to offset the costs of the promotion and maintain its profit margin while the promotion runs

E Whether a different tactic might allow the chain to increase its profitability while maintaining constant or diminished earnings


ready4gmat



IMO OA is A
Important message is below.
'but because the brand has high status appeal the corporate office believes that customers will want to show off their affiliation'
So I chose A

B Whether the promotion will be developed in-house
-> Do not need to think about 'developed in house'
C Whether some of the retailer’s merchandise will feature multiple small logos, or one large one
-> logo size is not important.
D Whether the chain will be able to offset the costs of the promotion and maintain its profit margin while the promotion runs
-> The passage said during the holiday season, a major retail clothing chain know that profit will be damaged, but the chain think it is wotrh to do it.
E Whether a different tactic might allow the chain to increase its profitability while maintaining constant or diminished earnings
-> Similar reason as D


I really like your reply, but I side with aaba, the question is so abnormal. The correct answer is about the belief and the argument is about short-term vs long-term.
Even though I can use POE method to choose A, I wonder whether real gmat questions will have such challenging questions.
GMAT Club Bot
Re: A major retail clothing chain hopes to improve its earnings with heavy &nbs [#permalink] 28 Feb 2018, 09:06
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A major retail clothing chain hopes to improve its earnings with heavy

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