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A year ago, Dietz Foods launched a yearlong advertising

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Re: A year ago, Dietz Foods launched a yearlong advertising [#permalink]

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New post 11 Aug 2013, 14:45
blueseas wrote:
xmizer wrote:
I am still confused about this question. By "economic interests" I would assume it means money. I understand that the campaign lead to 2 million or more cans of tuna being sold. But, if the profits of the additional cans were substantially less than the cost of the advertising campaign, how can it be said that the campaign furthered Dietz's economic interests. Please explain.


lets take 5 years as 1 2 3 4 5
year 1 =30 tuna sold
year 2 =25 tuna sold
year 3 =20 tuna sold
year 4 =15 tuna sold
year 5 =10 tuna sold
now advertising campaigncame
year 6 =12 tuna sold
since tuna selling was on a steep(was decreasing ) so increase in 2 tuna dont you think furthered economically.
hope it helps

let me know if you have doubt.


Well, if you mean "economically" as in sales, then yeah, I suppose in this case, the company is furthered economically. But I think the term "economically" is vague. It can mean market share, profits, revenue, etc. If you are talking about profits, the company is not furthered economically at all since the ad campaign costs more than the profits of the additional sales, which to me, means the ad campaign actually made the company lose money.

To highlight my point, if the company decided to give all the tuna away for free, I am sure they can sell millions more cans of tuna. They might even go bankrupt in the process but in this example, it would still consider it "furthering the company economically", since there is an increase in sales. But from a profit-motive standpoint, I fail to see how this is economically beneficial.
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New post 11 Aug 2013, 21:36
xmizer wrote:
Well, if you mean "economically" as in sales, then yeah, I suppose in this case, the company is furthered economically. But I think the term "economically" is vague. It can mean market share, profits, revenue, etc. If you are talking about profits, the company is not furthered economically at all since the ad campaign costs more than the profits of the additional sales, which to me, means the ad campaign actually made the company lose money.

To highlight my point, if the company decided to give all the tuna away for free, I am sure they can sell millions more cans of tuna. They might even go bankrupt in the process but in this example, it would still consider it "furthering the company economically", since there is an increase in sales. But from a profit-motive standpoint, I fail to see how this is economically beneficial.


Hi,

In almost all cases, economic interests imply profits. A company generally cannot further its economic interests by taking a hit on its bottom line or profits. The interpretation of "economic interest" is not different in this question. It means profits.

However, Option E DOES SUGGEST that the company might have made a PROFIT from the campaign.

To understand this, you need to read the passage carefully.

A year ago, Dietz Foods launched a yearlong advertising campaign for its canned tuna. Last year Dietz sold 12 million cans of tuna compared to the 10 million sold during the previous year, an increase directly attributable to new customers brought in by the campaign. Profits from the additional sales, however, were substantially less than the cost of the advertising campaign. Clearly, therefore, the campaign did nothing to further Dietz's economic interests.

Tell me when the passage is computing the profits from "additional sales", what is the additional sales it is considering? The additional sales it is looking at is 2 million cans.

However, option E suggests that the additional sales is much more than 2 millions cans (remember the word "Steep decline").

So, if the additional sales is much more than 2 million cans, then the profits from the campaign will also be much higher than as computed in the passage. It indicates that probably, the campaign did further the economic interests (profits) of the company. This thing (indicating that the opposite of conclusion is true) is the job of a weakener and option E does that aptly.

Thanks,
Chiranjeev
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Re: A year ago, Dietz Foods launched a yearlong advertising [#permalink]

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New post 10 Sep 2013, 11:22
@ Rajat @ e-gmat,

As expected from you, a stunning explanation. Could you please also explain this question
guillemots-are-birds-for-arctic-regions-they-feed-on-fish-82065.html
thanking in advance for your support
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WaterFlowsUp wrote:
@ Rajat @ e-gmat,

As expected from you, a stunning explanation. Could you please also explain this question
guillemots-are-birds-for-arctic-regions-they-feed-on-fish-82065.html
thanking in advance for your support


Hi,

Thanks for the appreciation!

By the way, it was me, not Rajat :wink:

-Chiranjeev
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Re: A year ago, Dietz Foods launched a yearlong advertising [#permalink]

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New post 10 Sep 2013, 21:19
@ chiranjeev :p thanks for correcting. could you please help us with mentioned link? that would of great help
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Re: A year ago, Dietz Foods launched a yearlong advertising [#permalink]

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New post 11 Sep 2013, 09:59
Its solved largely by POE

E says that even though, the costs of advertisements were higher than the profits from the sales, the company is better of selling more of the stuff than facing steep decline in sales (which could also result in wastage of what was processed).
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Re: A year ago, Dietz Foods launched a yearlong advertising [#permalink]

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New post 11 Sep 2013, 21:27
Conclusion is that advertising campaign did nothing for economic interest (profit) because of its high cost. To weaken it one should prove that the interest related to campaign at least was higher. The only choice considering it is B
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New post 12 Sep 2013, 02:31
WaterFlowsUp wrote:
@ chiranjeev :p thanks for correcting. could you please help us with mentioned link? that would of great help


Hi,

Surely, I can chime in. But it would be great if you can share your specific doubt on that thread because that would greatly cut down my time in responding.

Thanks,
Chiranjeev
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Re: A year ago, Dietz Foods launched a yearlong advertising [#permalink]

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New post 03 Oct 2013, 23:35
THIS IS a hard question and I want to follow this one.

normally, we prethink an assumption before going to the answer choices.

can we do so for this question. any one can do, please do so.
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Re: A year ago, Dietz Foods launched a yearlong advertising [#permalink]

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New post 22 Jun 2014, 01:12
I am not very clear about why is B wrong.
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New post 23 Jun 2014, 06:27
for some strenthen/weaken, it is good to prethink an assumption. for others, it is good to prethink a strengthener/weakener directly without thinking of assumption. this is the rule by manhantan

this question is typical of the type in which prethinking of an assumption is good.

why there is no economic justification? we need to challenge the argument to find an assumption.

it is possible that the economic benifit can appear in the following years, not now. this is a challenge.

assumption is that there is no benifit in the following years.

going to answer choices, we see that E closely match.
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Re: A year ago, Dietz Foods launched a yearlong advertising [#permalink]

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New post 20 Nov 2014, 05:19
I was stuck between E and C here.

I eliminated E thinking that in the last 5 years (including the year in which 12MN (Yr 5 - and not Yr6) and 10MN (Yr 4) tins were sold) the industry was in a declining trend. So had the company not advertised so heavily in Yr 5, its sales would have been much lesser than 10MN tins, may be say 8MN tins (if the industry decline rate was 20%). Just because it advertised heavily it had 20% more sales than each of its competitors is the market. This certainly now is an economic benefit! :D
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New post 17 Mar 2015, 20:51
Explanation for choice E

Type : weaken

conclusion: Campaign is fail

Assumption: increase in sales is not enough to offset the campaign cost.

Weaken: increase in sales do somehow offset the campaign cost and make profit for the companies.

Choice E is the best answer: the campaign do help to accelerate the sales of the company inspite of the declined tendency of the market
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New post 21 May 2015, 05:24
A year ago, Dietz Foods launched a yearlong advertising campaign for its canned tuna. Last year Dietz sold 12 million cans of tuna compared to the 10 million sold during the previous year, an increase directly attributable to new customers brought in by the campaign. Profits from the additional sales, however, were substantially less than the cost of the advertising campaign. Clearly, therefore, the campaign did nothing to further Dietz's economic interests.
The conclusion is that the campaign was not economically beneficial because profits from sales were less than the cost of the campaign.
Which of the following, if true, most seriously weakens the argument?

(A) Sales of canned tuna account for a relatively small percentage of Dietz Foods' profits. The percentage of profit is not relevant.
(B) Most of the people who bought Dietz's canned tuna for the first time as a result of the campaign were already loyal customers of other Dietz products.Loyal customers of other products doesn't necessarily mean canned tuna profits.
(C) A less expensive advertising campaign would have brought in significantly fewer new customers for Dietz's canned tuna than did the campaign Dietz Foods launched last year. out of scope
(D) Dietz made money on sales of canned tuna last year. Last year is not relevant.
(E) In each of the past five years, there was a steep, industry-wide decline in sales of canned tuna. The industry-wide decline may have been responsible for the lower profits, rather than the effectiveness of the campaign.
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New post 30 Jun 2015, 06:40
egmat wrote:
xmizer wrote:
Well, if you mean "economically" as in sales, then yeah, I suppose in this case, the company is furthered economically. But I think the term "economically" is vague. It can mean market share, profits, revenue, etc. If you are talking about profits, the company is not furthered economically at all since the ad campaign costs more than the profits of the additional sales, which to me, means the ad campaign actually made the company lose money.

To highlight my point, if the company decided to give all the tuna away for free, I am sure they can sell millions more cans of tuna. They might even go bankrupt in the process but in this example, it would still consider it "furthering the company economically", since there is an increase in sales. But from a profit-motive standpoint, I fail to see how this is economically beneficial.


Hi,

In almost all cases, economic interests imply profits. A company generally cannot further its economic interests by taking a hit on its bottom line or profits. The interpretation of "economic interest" is not different in this question. It means profits.

However, Option E DOES SUGGEST that the company might have made a PROFIT from the campaign.

To understand this, you need to read the passage carefully.

A year ago, Dietz Foods launched a yearlong advertising campaign for its canned tuna. Last year Dietz sold 12 million cans of tuna compared to the 10 million sold during the previous year, an increase directly attributable to new customers brought in by the campaign. Profits from the additional sales, however, were substantially less than the cost of the advertising campaign. Clearly, therefore, the campaign did nothing to further Dietz's economic interests.

Tell me when the passage is computing the profits from "additional sales", what is the additional sales it is considering? The additional sales it is looking at is 2 million cans.

However, option E suggests that the additional sales is much more than 2 millions cans (remember the word "Steep decline").

So, if the additional sales is much more than 2 million cans, then the profits from the campaign will also be much higher than as computed in the passage. It indicates that probably, the campaign did further the economic interests (profits) of the company. This thing (indicating that the opposite of conclusion is true) is the job of a weakener and option E does that aptly.

Thanks,
Chiranjeev


@Chiranjeev , egmat

Hi i have one doubt here as argument has clearly mentioned that last year 10 million cans were sold and this year its 12 million then how can you say it is more then 2 millions.

Please clarify.

Thanks.
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New post 16 Nov 2015, 01:08
egmat wrote:
Before we get to the logic of this question, lets understand the role a weakener should play:

A weakener decreases your belief in the conclusion. This means, that after reading the correct weakener choice and one should say that "I do not believe as strongly in the conclusion now" . Note, a weakener does not have to disprove the conclusion.

Lets now see the argument in the light of the above principle. We will first focus on the conclusion:

Conclusion: Clearly, therefore, the campaign did nothing to further Dietz's economic interests.

What does the conclusion mean: Considering that economic interests == profits, either short term or long term, the conclusion implies that the advertising campaign did not contribute to either.
Why does the author say this: The author makes this statement because the cost of the campaign is higher than the incremental sales (2 million cans), allegedly because of the campaign.

What could be some weakeners:
There could be two potential ways to weaken this argument:
1. If an answer choice projects the possibility that the campaign may have contributed for more than 2 million cans of sales.
2. If an answer choice projects the possibility that the new customers would become repeat customers; i.e. they would bring more sales in the future. Note this again means that the benefit from the campaign would be greater than the 2 million cans.

Choice E

1. Choice E projects the possibility that the campaign may have contributed for more than 2 million cans of sales. Hence is the correct choice.

Choice C


Choice C is actually completely irrelevant. lets look at choice C to understand why:
Quote:
A less expensive advertising campaign would have brought in significantly fewer new customers for Dietz's canned tuna than did the campaign Dietz Foods launched last year.


This is talking about a completely different campaign. It has nothing to do with whether the current campaign contributed to furthering Dietz's economic interests.

TakeAway: A weakener provides new information, which in the light of the information presented in the argument, reduces your belief in the conclusion. Secondly, a majority (95%+) of Weaken Questions have only one weakener.

-Rajat



What about answer B??
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New post 17 Nov 2015, 05:06
ExecMBA2010 wrote:
A year ago, Dietz Foods launched a yearlong advertising campaign for its canned tuna. Last year Dietz sold 12 million cans of tuna compared to the 10 million sold during the previous year, an increase directly attributable to new customers brought in by the campaign. Profits from the additional sales, however, were substantially less than the cost of the advertising campaign. Clearly, therefore, the campaign did nothing to further Dietz's economic interests.

Which of the following, if true, most seriously weakens the argument?

(A) Sales of canned tuna account for a relatively small percentage of Dietz Foods' profits.
(B) Most of the people who bought Dietz's canned tuna for the first time as a result of the campaign were already loyal customers of other Dietz products.
(C) A less expensive advertising campaign would have brought in significantly fewer new customers for Dietz's canned tuna than did the campaign Dietz Foods launched last year.
(D) Dietz made money on sales of canned tuna last year.
(E) In each of the past five years, there was a steep, industry-wide decline in sales of canned tuna.

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Can someone tell me why not B. B too improved the sales ?
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Re: A year ago, Dietz Foods launched a yearlong advertising [#permalink]

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New post 18 Jan 2016, 16:18
chiranjeev12 wrote:
PS: If you think C could have been the answer, then look again into it. It used unclear words two times within one sentence: "less expensive" - how much less - 10%, 20%, 90%?; "significantly fewer new customers" - how few - 60% less, 90%, 99%? The statement is too weak to be an answer.


blueseas wrote:

lets take 5 years as 1 2 3 4 5
year 1 =30 tuna sold
year 2 =25 tuna sold
year 3 =20 tuna sold
year 4 =15 tuna sold
year 5 =10 tuna sold
now advertising campaigncame
year 6 =12 tuna sold
since tuna selling was on a steep(was decreasing ) so increase in 2 tuna dont you think furthered economically.
hope it helps

let me know if you have doubt.



Hope to revive this thread. I am a little confused about (E) because my thought process was:

From the question

Advertising campaign (AC) = 2 million sales
Cost of AC > profit from 2 million sales
Thus Dietz didn't benefit from the additional 2 million sales (as money was squandered in AC)

I then asked: "how much of a loss?" The stimulus states that the Profits from 2 millions sales were "SUBSTANTIALLY" less than the cost of AC. But what does substantially mean? 20% 50% 80%?

From (E)
I then considered: "what is a 'STEEP' decline" If e.g. 1million decrease in sales is considered a steep decline - then Dietz who ended the year on 12m sales from 10m sales because of AC, but otherwise may have ended on 9m sales - so a 1m sales decline. Is the profit from 1m sales > the additional cost of AC (that the additional 2m sales did not cover).

Hope this makes sense. Put another way, I am comparing Before AC (e.g. 9m sales) and After AC (as we know - 12m sales) scenario - and whether the cost of AC is covered.

Put another way yet again - am I correct in my understanding that "economic interest" means overall profit. I would assume that AC supported Dietz's economic interest if Dietz would have made "more of a loss" otherwise. So I'm focusing on profits opposed to hard sales numbers (millions of sales). I just didn't feel that (E) gave me this information..

I really don't know if I'm overthinking this?.. Feedback would be appreciated so that I know how to think about such scenarios in the future!

Thanks
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I would try a simpler approach. Sales of "Dietz's" canned Tuna increased to 12 million from 10 million last year. Although there was a two million increase because of a new advertisement campaign but the investment was more than the profit. Hence the author concludes the advertisement campaign did nothing. Any answer choice which proves the campaign at least did have some contribution is the answer. "E" states there had been a continuous decline for the last five years. Hence even if sales increased by two million in the present year the campaign must have been responsible for that.
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Re: A year ago, Dietz Foods launched a yearlong advertising [#permalink]

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New post 22 Mar 2016, 07:54
Though E is indeed correct, I still don't understand why B is wrong.

If the company has more loyal customers, it will definitely did something good for company's further economic interest.
Re: A year ago, Dietz Foods launched a yearlong advertising   [#permalink] 22 Mar 2016, 07:54

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