BillyZ wrote:
At the beginning of 2015, an airport changed concession vendors from FlightDelight to AirFare. By the end of the 2015, concession sales were up nearly 10%, but effective January 2016 the airport cancelled the AirFare contract and returned to using Flight Delight, citing low sales as the sole reason.
Which of the following, if true, most serves to reconcile the discrepancy above?
A. The city’s other major airport saw a sales increase of 15% for the year 2015.
B. Travelers rated AirFare’s variety of offerings significantly lower than they had rated the variety of offerings from FlightDelight.
C. For the year 2015 several airlines that fly routes in and out of the airport overhauled their in-flight menus.
D. The number of flights departing from the airport was 30% higher in 2015 than it had been in 2014.
E. AirFare’s sales were slow over the first half of 2015 because it closed multiple points of sale to make renovations.
OFFICIAL EXPLANATION
In this Explain the Paradox problem, the paradox is that sales were up 10% but the airport saw that as "low sales," enough to fire the company that presided over that increase. Here a savvy examinee might start predicting reasons: what if sales should have been up quite a bit more than 10%? You're looking for a reason (maybe rampant inflation) that a 10% increase in sales did not keep up with what would have been the expected increase. And choice D provides that: if the airport was 30% busier overall, then you would have expected sales volume to be in the 30% increase range holding all other variables the same. So a 10% increase did not keep pace with expectation.
Of the incorrect choices: choice A brings in a comparison that is largely irrelevant. Since you do not know the starting points of each airport (that 15% increase could have been from a historic low) you cannot conclude that this airport's 10% increase was "bad" just from the comparison. Choice B also brings in an irrelevant point, as the stimulus clearly states that "low sales" was the SOLE reason for replacing vendors.
Choices C and E, at least to some extent, somewhat justify a low sales increase. If C were true, then that might suggest that more people would wait to eat on the plane and not eat at the airport. In that light, even a small sales increase could be seen as a good thing, making the decision to fire the vendor seem less justified. Even more so, E performs the same function: if there were fewer points of sale for much of the year but an overall increase, one would think that the increase of 10% would likely increase again for the next year and make firing the vendor seem like a poor move.
At the beginning of 2015, Airfare was recruited.
In 2015, the sales increased by 10%.
But Airfare was kicked out because of 'low sales'.
We need to resolve this paradox. That means that the sales did increase by 10% but were still considered 'low.'
How could that happen? Forget the options and think about it. When would a sales increase of 10% be considered 'low sales'? When actually one expects a far higher increase. Say if the number of travellers has increased much more than 10%, then an increase in sales of 10% would be considered low.
So the logic could be along those lines.
A. The city’s other major airport saw a sales increase of 15% for the year 2015.
I wouldn't eliminate this option right away. If all other major, similar airports saw sales increase of 15%, then a 10% increase here could be considered low. But here is the thing - what if traffic from this airport was actually diverted to the other major airport and that is why they saw a sales increase of 15%? We are not given that the situation at the 2 airports is comparable. Hence, let's look for a better option.
B. Travelers rated AirFare’s variety of offerings significantly lower than they had rated the variety of offerings from FlightDelight.
Irrelevant. Note that Airfare showed a 10% sales increase. Perhaps their variety is low but quality of what they keep is very high. More people still bought. So overall Airfare seems to have done a better job than FlightDelight even if they scored lower in one factor. The reason cited by the airport is only the low revenue. This doesn't explain why the airport felt that revenue generated by Airfare is low.
C. For the year 2015 several airlines that fly routes in and out of the airport overhauled their in-flight menus.
We don't know anything about its impact on revenue.
D. The number of flights departing from the airport was 30% higher in 2015 than it had been in 2014.
Correct. If 30% more flights were departing from the airport, it means that the passenger traffic has increased by a substantial percentage. Note that more flights would be added if there is demand. Flying planes is expensive so we can reasonably expect that no airline will fly 2 half full planes. We can reasonably expect that more flights means more passengers. So the airport may have expected a 30% increase in revenue but since it saw only 10% increase, it terminated the services of airfare citing 'low revenue'.
E. AirFare’s sales were slow over the first half of 2015 because it closed multiple points of sale to make renovations.
It doesn't explain why the airport feels that the 10% increase is low.
Answer (D)
close
12 Apr 2017, 06:46
37%
(02:02)
wrong 
