It is currently 22 Jun 2017, 13:54

### 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

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

# Events & Promotions

###### Events & Promotions in June
Open Detailed Calendar

# Complaints that milk bottlers take enormous markups on the

Author Message
VP
Joined: 29 Dec 2005
Posts: 1341
Complaints that milk bottlers take enormous markups on the [#permalink]

### Show Tags

02 Apr 2006, 12:48
00:00

Difficulty:

(N/A)

Question Stats:

0% (00:00) correct 0% (00:00) wrong based on 0 sessions

### HideShow timer Statistics

Complaints that milk bottlers take enormous markups on the bottled milk sold to consumers are most likely to arise when least warranted by the actual spread between the price that bottlers pay for raw milk and the price at which they sell bottled milk. The complaints occur when the bottled-milk price rises, yet these price increases most often merely reflect the rising price of the raw milk that bottlers buy from dairy farmers. When the raw-milk price is rising, the bottlersâ€™ markups are actually smallest proportionate to the retail price. When the raw-milk price is falling, however, the markups are greatest.

If all of the statements above are true, which one of the following must also be true on the basis of them?

(A) Consumers pay more for bottled milk when raw-milk prices are falling than when these prices are rising.
(B) Increases in dairy farmersâ€™ cost of producing milk are generally not passed on to consumers.
(C) Milk bottlers take substantially greater markups on bottled milk when its price is low for an extended period than when it is high for an extended period.
(D) Milk bottlers generally do not respond to a decrease in raw-milk prices by straightaway proportionately lowering the price of the bottled milk they sell.
(E) Consumers tend to complain more about the price they pay for bottled milk when dairy farmers are earning their smallest profits.
Director
Joined: 06 Feb 2006
Posts: 897

### Show Tags

02 Apr 2006, 13:09
Now this one is tougth

I choose D
Director
Joined: 24 Oct 2005
Posts: 659
Location: London

### Show Tags

03 Apr 2006, 03:22
(A) Consumers pay more for bottled milk when raw-milk prices are falling than when these prices are rising. - Consumers pay pretty much same both times.
(B) Increases in dairy farmersâ€™ cost of producing milk are generally not passed on to consumers. - Bit of an extreme statement. Can go beyong scope of this passage.
(C) Milk bottlers take substantially greater markups on bottled milk when its price is low for an extended period than when it is high for an extended period. - Passage does not talk about extended periods.
(D) Milk bottlers generally do not respond to a decrease in raw-milk prices by straightaway proportionately lowering the price of the bottled milk they sell. _ think is better of the lot .
(E) Consumers tend to complain more about the price they pay for bottled milk when dairy farmers are earning their smallest profits.- Nobody is complaining in this passage.

Ans = D
Director
Joined: 13 Nov 2003
Posts: 789
Location: BULGARIA

### Show Tags

03 Apr 2006, 05:25
Hmm....think it should be A
VP
Joined: 21 Mar 2006
Posts: 1127
Location: Bangalore

### Show Tags

03 Apr 2006, 06:03
D it is.

(A) Consumers pay more for bottled milk when raw-milk prices are falling than when these prices are rising.

This states that the bottlers are making maximum profits when the raw-milk prices are down. But it does not say anything about the price the consumer pays.
Senior Manager
Joined: 08 Sep 2004
Posts: 257
Location: New York City, USA

### Show Tags

03 Apr 2006, 09:02
IMO D.
Senior Manager
Joined: 22 Nov 2005
Posts: 474

### Show Tags

03 Apr 2006, 11:29
Professor wrote:
Complaints that milk bottlers take enormous markups on the bottled milk sold to consumers are most likely to arise when least warranted by the actual spread between the price that bottlers pay for raw milk and the price at which they sell bottled milk. The complaints occur when the bottled-milk price rises, yet these price increases most often merely reflect the rising price of the raw milk that bottlers buy from dairy farmers. When the raw-milk price is rising, the bottlersâ€™ markups are actually smallest proportionate to the retail price. When the raw-milk price is falling, however, the markups are greatest.

If all of the statements above are true, which one of the following must also be true on the basis of them?

(A) Consumers pay more for bottled milk when raw-milk prices are falling than when these prices are rising.
(B) Increases in dairy farmersâ€™ cost of producing milk are generally not passed on to consumers.
(C) Milk bottlers take substantially greater markups on bottled milk when its price is low for an extended period than when it is high for an extended period.
(D) Milk bottlers generally do not respond to a decrease in raw-milk prices by straightaway proportionately lowering the price of the bottled milk they sell.
(E) Consumers tend to complain more about the price they pay for bottled milk when dairy farmers are earning their smallest profits.

This is an inference questions.
from
When the raw-milk price is falling, however, the markups are greatest.

we can draw inference D
Manager
Joined: 10 Jan 2006
Posts: 114

### Show Tags

03 Apr 2006, 13:27
one more for 'D'
Manager
Joined: 30 Jan 2006
Posts: 145

### Show Tags

03 Apr 2006, 19:08
C it is.

Here's my attempt to explain:
A - it's the other way around.
B & E are out because dairy farmers is out of scope.
D - nothing is indicated about the timing of price-adjustments to fluctuations in raw-milk prices. Also, a little bit extreme when stating generally do not respond
Senior Manager
Joined: 08 Jun 2004
Posts: 495
Location: Europe

### Show Tags

03 Apr 2006, 21:10
'D' it is.

Complaints that milk bottlers take enormous markups on the bottled milk sold to consumers are most likely to arise when least warranted by the actual spread between the price that bottlers pay for raw milk and the price at which they sell bottled milk. The complaints occur when the bottled-milk price rises, yet these price increases most often merely reflect the rising price of the raw milk that bottlers buy from dairy farmers. When the raw-milk price is rising, the bottlersâ€™ markups are actually smallest proportionate to the retail price. When the raw-milk price is falling, however, the markups are greatest.

(D) Milk bottlers generally do not respond to a decrease in raw-milk prices by straightaway proportionately lowering the price of the bottled milk they sell.

'D' is clearly explained by the last 2 sentences.
03 Apr 2006, 21:10
Similar topics Replies Last post
Similar
Topics:
Complaints that milk bottlers take enormous markups on the 4 22 Feb 2008, 09:16
5 The milk of many mammals contains cannabinoids, substances 4 15 Feb 2008, 08:20
When people predict that certain result will not take place 5 12 Aug 2007, 00:45
Marian Anderson, the famous contralto, did not take success 1 19 Jul 2007, 05:41
When people predict that certain result will not take place 4 02 Jul 2007, 21:06
Display posts from previous: Sort by