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# An analysis of the XO Candy Corporation divided its products into two

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An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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20 Aug 2016, 17:40
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An analysis of the XO Candy Corporation divided its products into two categories: chocolate-based candies and non-chocolate-based candies. The analysis shows that, unlike the non-chocolate candies, few chocolate candies sold enough units to be profitable. Nevertheless, stopping production of the unprofitable chocolate candies will not necessarily make the entire company more profitable, because__________________ .

Which of the following most logically completes the passage?

(A) a large proportion of XO’s customers are those who initially bought XO’s chocolate candies and eventually went on to buy other candies made by XO.

(B) XO has recently removed its two lowest-selling chocolate candies from their product line and replaced them with different types of chocolate candies.

(C) the recipes of the chocolate candies date from the 19th century, while the non-chocolate candies were all developed more recently.

(D) the chocolate candies are distributed differently than the non-chocolate candies, as chocolates are more popular on the coasts.

(E) fewer people eat candy at all than they did a decade ago because of growing concern about obesity.
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Farrell D Hehn: MBA
Re: An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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22 Aug 2016, 02:46
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Taking a loss on the chocolate candies but they are overall making the company more profitable.

That's my paraphrase of this whole thing, and my focus is on finding an answer that is going to tell me why it's worth it to take a hit with the chocolate candies , because it leads to Greater Revenue overall.

A is the only answer that speaks to that.

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Re: An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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21 Oct 2016, 03:12
"Supports" is a pointer that can be used for both inference & strengthen questions. In that case, how do i differentiate between whether the question being asked belongs to Inference / strengthen ?

Can anyone explain this???
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Re: An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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02 Sep 2017, 00:48
My reasoning would be : The chocolate candies are popular on the coasts ,but the other candies might be popular elsewhere ,hence it is required for XO to keep producing both varieties ..
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Re: An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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02 Sep 2017, 06:50
SARANYA18DASS wrote:
My reasoning would be : The chocolate candies are popular on the coasts ,but the other candies might be popular elsewhere ,hence it is required for XO to keep producing both varieties ..

:
lets take ur reasoning:: non choc. is famous else where ...but still we have in question stem that those choc are non profitable , then why to operate that ..?????..company is earning profit with choc candies...
this answer choice is not giving that explanation.

where as in A -- it is highlighted that selling of one choc is depended upon other --so stopping the production of one type choc can hamper other's sell...
A is best --it gives a reason to ponder on .
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Re: An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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06 Jun 2018, 05:02
i still didn't understand why d is a wrong choice. Can someone please clarify that

okok....D is a wrong choice and does not answer the blank; If we replace the blank with choice d ,then the argument does not make any sense because the reasoning would be flawed.

Please correct me if i'm wrong.
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Re: An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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06 Jun 2018, 05:22
SonGoku wrote:
i still didn't understand why d is a wrong choice. Can someone please clarify that

okok....D is a wrong choice and does not answer the blank; If we replace the blank with choice d ,then the argument does not make any sense because the reasoning would be flawed.

Please correct me if i'm wrong.

Hey SonGoku ,

How the two candies are sold has no connection with profitability of the company unless you actually start assuming your own points. Selling process doesn't tell us anything about why we should not stop selling non chocolate candies.

Does that make sense?
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Re: An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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12 Jun 2018, 01:00
One of the biggest problem i got with A is that what if all the companies who initially bought chocolate candy doesn't buy chocolate candy anymore, all they buy is non-chocolate candy. Then company has no reason to continue chocolate candy production.
IMO B sounds little better, as market of new chocolate candy has not been established yet, and there's no point to shut it down.
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Re: An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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21 Jun 2018, 12:22
Okay in my opinion B is completely out of scope because the company has not mentioned about the product line and other types of candies
A- the company may need to continue its production because again the customers can come back to buy chocolate candies.

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An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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09 Jul 2018, 11:32
Main Premise: stopping production of the unprofitable chocolate candies will not necessarily make the entire company more profitable. Hence there should be some other factor responsible which makes the company unprofitable.

A) Reduction in customer base. Valid reason for reduction in profitability. Correct
B) No surety of new chocolate candies being profitable
C) No relation stated between recipes and profitability
D) No relation stated between distribution and profitability
E) Valid argument but does not impact XO's chocolate candies as specifically as option A does.
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Re: An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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09 Aug 2018, 18:19

Official Explanation

Answer = (A). In this situation, the seeming paradox is that an unprofitable product should still be produced. The correct answer will provide us with a reason that product should continue to be produced; (A) correctly does this, providing a logical explanation for the scenario. If the candy is unprofitable, but introduces customers to other products that are profitable, it may make sense in the long run to keep producing both the chocolate and the non-chocolate candies.

The recent replacement of the chocolate candies has nothing to do with whether they should still be produced (B); if they are unprofitable as a group, the company either needs a reason that they in some way add to profits, or it should stop making them.

Similarly, the consumers don’t seem to care about when the recipes for the candies date from (C) when choosing their candy. The fact remains that the chocolate candies are still less popular, and this statement does not explain why.

(D) describes the distribution pattern of the popular and unpopular candies, but doesn’t explain why it might help the company to keep producing the unpopular candies.

(E) would work as an explanation for reduced candy consumption overall, but this company is trying to explain why continuing to produce one type of unpopular candy still makes sense when its other candy is more popular. In this argument, the company is not concerned with the overall level of candy consumption.
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Re: An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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17 Feb 2019, 07:17
DrAB wrote:
An analysis of the XO Candy Corporation divided its products into two categories: chocolate-based candies and non-chocolate-based candies. The analysis shows that, unlike the non-chocolate candies, few chocolate candies sold enough units to be profitable. Nevertheless, stopping production of the unprofitable chocolate candies will not necessarily make the entire company more profitable, because__________________ .

Which of the following most logically completes the passage?

(A) a large proportion of XO’s customers are those who initially bought XO’s chocolate candies and eventually went on to buy other candies made by XO.

(B) XO has recently removed its two lowest-selling chocolate candies from their product line and replaced them with different types of chocolate candies.

(C) the recipes of the chocolate candies date from the 19th century, while the non-chocolate candies were all developed more recently.

(D) the chocolate candies are distributed differently than the non-chocolate candies, as chocolates are more popular on the coasts.

(E) fewer people eat candy at all than they did a decade ago because of growing concern about obesity.

So lets see, what is the crux of the argument ??

two categories: chocolate-based candies and non-chocolate-based candies.
The analysis shows that, unlike the non-chocolate candies, few chocolate candies sold enough units to be profitable.
Nevertheless, stopping production of the unprofitable chocolate candies will not necessarily make the entire company more profitable, because
Why stopping production will not necessarily make the entire company more profitable??

First of all why are we even discussing about them ??Lets see the options now
(A) a large proportion of XO’s customers are those who initially bought XO’s chocolate candies and eventually went on to buy other candies made by XO.
This actually relates with the last line, they might buy from the rest.

(B) XO has recently removed its two lowest-selling chocolate candies from their product line and replaced them with different types of chocolate candies.
This is irrelevant, to the scope of the argument.

(C) the recipes of the chocolate candies date from the 19th century, while the non-chocolate candies were all developed more recently.
Does this mean should we remove them??

(D) the chocolate candies are distributed differently than the non-chocolate candies, as chocolates are more popular on the coasts.
Distribution wont effect the production.

(E) fewer people eat candy at all than they did a decade ago because of growing concern about obesity.
fewer people means out what ? out of 10, 100 ,1000,100000
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Re: An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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02 Jul 2019, 08:42
It seems to me that this question is rather Strengthen than Inference. Answer choice A provides somewhat new information, and Inference questions are only based on facts that are given in the premise.
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Re: An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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02 Jul 2019, 21:57
In plain simple words, I am looking for a reason to not stop the unprofitable chocolate candy and only option A provides the logic
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Re: An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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03 Jul 2019, 05:17
(A) a large proportion of XO’s customers are those who initially bought XO’s chocolate candies and eventually went on to buy other candies made by XO. (This shows that people initially started with chocolate candies and then shifted , this means chocolate candies attract first time customers , hence the right answer)

(B) XO has recently removed its two lowest-selling chocolate candies from their product line and replaced them with different types of chocolate candies. (This does not tell us anything as to why the company should not close down the division)

(C) the recipes of the chocolate candies date from the 19th century, while the non-chocolate candies were all developed more recently. (recipe Out of Scope)

(D) the chocolate candies are distributed differently than the non-chocolate candies, as chocolates are more popular on the coasts. (If chocolate candies are so popular then the company would have made profits)

(E) fewer people eat candy at all than they did a decade ago because of growing concern about obesity. (Out of Scope)
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Re: An analysis of the XO Candy Corporation divided its products into two  [#permalink]

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17 Aug 2019, 01:09
An analysis of the XO Candy Corporation divided its products into two categories: chocolate-based candies and non-chocolate-based candies. The analysis shows that, unlike the non-chocolate candies, few chocolate candies sold enough units to be profitable. Nevertheless, stopping production of the unprofitable chocolate candies will not necessarily make the entire company more profitable, because__________________ .

Which of the following most logically completes the passage?

Pre-thinking:
We are given a scenario in which non chocolate candies are profitable but few chocolate candies are profitable. So if an answer choice links chocolate candies with some side profits we will have our solution.

(A) a large proportion of XO’s customers are those who initially bought XO’s chocolate candies and eventually went on to buy other candies made by XO.
With this choice you can see that by eliminating chocolate candies probably many customers won't buy other candies subsequently. Hence correct

(B) XO has recently removed its two lowest-selling chocolate candies from their product line and replaced them with different types of chocolate candies.
This choice does not clearly impact the argument. Hence incorrect

(C) the recipes of the chocolate candies date from the 19th century, while the non-chocolate candies were all developed more recently.
It is irrelevant the recipe since we don't know how it affects the argument. Hence incorrect

(D) the chocolate candies are distributed differently than the non-chocolate candies, as chocolates are more popular on the coasts.
Still few chocolate candies are profitable. Hence incorrect

(E) fewer people eat candy at all than they did a decade ago because of growing concern about obesity.
irrelevant. Hence incorrect
Re: An analysis of the XO Candy Corporation divided its products into two   [#permalink] 17 Aug 2019, 01:09
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