GMAT Question of the Day - Daily to your Mailbox; hard ones only

It is currently 17 Oct 2019, 03:27

Close

GMAT Club Daily Prep

Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track
Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.

Close

Request Expert Reply

Confirm Cancel

Companies that must determine well in advance of the selling season ho

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
TAGS:

Hide Tags

Find Similar Topics 
Current Student
User avatar
V
Joined: 19 Mar 2012
Posts: 4258
Location: India
GMAT 1: 760 Q50 V42
GPA: 3.8
WE: Marketing (Non-Profit and Government)
Companies that must determine well in advance of the selling season ho  [#permalink]

Show Tags

New post Updated on: 15 Aug 2019, 20:16
1
3
Question 1
00:00
A
B
C
D
E

based on 343 sessions

57% (02:48) correct 43% (02:56) wrong

HideShow timer Statistics

Question 2
00:00
A
B
C
D
E

based on 295 sessions

76% (01:13) correct 24% (01:40) wrong

HideShow timer Statistics

Question 3
00:00
A
B
C
D
E

based on 302 sessions

84% (01:03) correct 16% (01:03) wrong

HideShow timer Statistics

Companies that must determine well in advance of the selling season how many unites of a new product to manufacture often under-produce products that sell well and have overstocks of others. The increased incidence in recent years of mismatches between production and demand seems ironic, since point-of sale scanners have improved data on consumers’ buying patterns and since flexible manufacturing has enabled companies to produce, cost-effectively, small quantities of goods. This type of manufacturing has greatly increased the number of new products introduced annually in the United States. However, frequent introductions of new products have two problematic side effects. For one, they reduce the average lifetime of products; more of them are neither at the beginning of their life (when prediction is difficult) or at the end of their life (when keeping inventory is expensive because the products will soon become obsolete). For another, as new products proliferate, demand is divided among a growing number of stock-keeping units (SKU’s). Even though manufacturers and retailers can forecast aggregate demand with some certainty, forecasting accurately how that demand will be distributed among the many SKU’s they sell is difficult. For example, a company may be able to estimate accurately the aggregate number of shoes it will sell, but it may be uncertain about which specific types of shoes will sell more than other types.

1) Which of the following most accurately describes the function of the last sentence in the passage?

A. To cite a situation in which the aggregate demand is more important than the distribution of demand among SKU’s
B. To refute an assertion about the side effects of flexible manufacturing
C. To illustrate an assertion about companies’ ability to forecast demand
D. To provide an example of ways in which companies address the difficulties of forecasting demand
E. To note an exception to the author’s assertion about distributing demand among SKU’s



2) The passage suggests which of the following about divided demand among a growing number of SKU’s?

A. It has increased the average lifetime of products.
B. It has resulted from retailer’s attempts to predict demand more accurately and avoid both understocks and overstocks.
C. It has decreased the use of flexible manufacturing by companies.
D. It has not increased the expense of keeping inventory of certain products.
E. It has not prevented companies from predicting aggregate demand with some certainty.



3) According to the passage, which of the following has led to growth in the number of new products introduced in the United States each year?

A. Reduced average lifetime of products
B. Increased ability to forecast aggregate demand
C. More cost-effective ways of keeping inventory for products
D. Cost-effective production of small quantities of goods
E. Increased ability to divide demand among a number of SKU’s and to forecast how that demand will be distributed among those SKU’s



_________________

Originally posted by souvik101990 on 26 May 2016, 19:34.
Last edited by SajjadAhmad on 15 Aug 2019, 20:16, edited 4 times in total.
Updated - Complete topic (151).
Manager
Manager
User avatar
G
Joined: 14 Oct 2017
Posts: 237
GMAT 1: 710 Q44 V41
Re: Companies that must determine well in advance of the selling season ho  [#permalink]

Show Tags

New post 29 May 2018, 10:49
1
About question 1, vaiv123

The last sentence looks as follows
Quote:
For example, a company may be able to estimate accurately the aggregate number of shoes it will sell, but it may be uncertain about which specific types of shoes will sell more than other types.


Now let's take a look at D and C:

Quote:
D. To provide an example of ways in which companies address the difficulties of forecasting demand

Does the last sentence explain how companies fix the difficulty of forecasting demand? No, it just states that accurate forecasts for the aggregate number of sales are possible but it doesn't explain how these forecasts are generated. Hence, we can rule out answer D.

Quote:
C. To illustrate an assertion about companies’ ability to forecast demand

This answers mentions an assertion, but which one is it talking about? In the previous sentence we find " Even though manufacturers and retailers can forecast aggregate demand with some certainty, forecasting accurately how that demand will be distributed among the many SKU’s they sell is difficult". This quote is the assertion that example in the last sentence illustrates. The example shows that aggregate demand can be forecasted but the specific demand for certain SKUs can be predicted.


Hope that helps :-)
_________________
My goal: 700 GMAT score - REACHED :-) | My debrief - first attempt 710 (Q44,V41,IR7)

If I could help you with my answer, consider giving me Kudos
Senior RC Moderator
User avatar
V
Joined: 02 Nov 2016
Posts: 4106
GPA: 3.39
Re: Companies that must determine well in advance of the selling season ho  [#permalink]

Show Tags

New post 15 Aug 2019, 20:16
GMAT Club Bot
Re: Companies that must determine well in advance of the selling season ho   [#permalink] 15 Aug 2019, 20:16
Display posts from previous: Sort by

Companies that must determine well in advance of the selling season ho

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  





Powered by phpBB © phpBB Group | Emoji artwork provided by EmojiOne