Contrary to earlier predictions, demand for sugarcane has not increase

Question

Contrary to earlier predictions, demand for sugarcane has not increased in recent years. Yet, even though prices and production amounts have also been stable during the last three years, sugarcane growers last year increased their profits by more than ten percent over the previous year's level.

Any of the following statements, if true about last year, helps to explain the rise in profits  EXCEPT :

(A) Many countries that are large consumers of sugarcane increased their production of sugarcane-based ethanol, yet their overall consumption of sugarcane decreased.

(B) Sugarcane growers have saved money on wages by switching from paying laborers an hourly wage to paying them by the amount harvested.

(C) The price of oil, the major energy source used by sugarcane growers in harvesting their crops, dropped by over twenty percent.

(D) Many small sugarcane growers joined together to form an association of sugarcane producers and began to buy supplies at low group rates.

(E) Rainfall in sugarcane-growing regions was higher than it had been during the previous year, allowing the growers to save money on expensive artificial irrigation.

hanumayamma · Accepted Answer

Except type questions are slightly tricky. Please rephrase these questions by add following “ does not/ will not ” in the question.

Rephrase: Any of the following statements, if true about last year, does not help to explain the rise in profits:

(A)Many countries that are large consumers of sugarcane increased their production of sugarcane-based ethanol. yet their overall consumption decreased.  Has nothing to do with the profits ]

(B)Sugarcane growers have saved money on wages by switching from paying laborers an hourly wage to paying them by the amount harvested.  Lower wages can yield higher profits - contributor to increase rise in profits – eliminate it ]

(C)The price of the oil, the major energy source used by sugarcane growers in harvesting their crops, dropped by morethan 20%.  Drop in oil prices – can contribute to profits - eliminate it ]

(D)Mnay small sugarcane growers joined together to form an association of sugarcane producers and began to buy supplies at low group rates.  Wholesale purchase can increase profits - eliminate it ]

(E)Rainfall in sugarcane-growing regions was higher than it had been during the previous year, allowing the growers to save money on expensive arificial irrigation.

Answer A

Paul · Answer

A it is
B talks about sugarcane growers saving money on wages and thus increased their profitability
A talks about supply and demand. It says that sugarcane supply increased and demand decreased. This means that there is an oversupply of sugarcane and either that prices should have come down or sugarcane itself would not sell. It  cannot  explain why profitability increased

dynamo · Answer

To tackle such kind of questions,replace
 
'Except'  by  'does not'  in the question stem.

Any of the following statements, if true about last year, helps to explain the rise in profits EXCEPT:

can be replaced by

Any of the following statements, if true about last year,  does not help  to explain the rise in profits

IMO A.

gmatlbs · Answer

Argument analysis : 
Contrary to earlier predictions, demand for sugarcane has not increased in recent years.  A background information.
 
 Yet,  even though prices and production amounts have also been stable during the last three years,  sugarcane growers last year increased their profits by more than ten percent over the previous years level. Yet: indicating contrast

Profit = Revenue – Cost
Revenue = Price*Quantity Price. Neither demand (Quantity) nor Price increased.

increase in Profit : different possiblities 
a. Revenue  -  Not possible as mentioned in the premise 
b. Cost  -  Only possibility to justify the increase in profit  
c. Both happened -  Not possible as mentioned in the premise 
d. Other possibilities as well such as i and ii -  cannot happen because Revenue has not changed  
 I. Revenue  and Cost  - Yet Absolute value was more
 II. Revenue  and Cost  - Yet Absolute value was more

Question Stem : Any of the following statements, if true about last year, helps to explain the rise in profits  EXCEPT: 
Except:  4 options  will talk about  decrease in cost  and  1  will  mention about increase or any other irrelevant data point.

(A) Many countries that are large consumers of sugarcane increased their production of sugarcane-based ethanol, yet their overall consumption of sugarcane decreased.  Irrelevant  
(B) Sugarcane growers  have saved money  on wages by switching from paying laborers an hourly wage to paying them by the amount harvested.  Mentions decrease in cost 
(C)  The price of oil , the major energy source used by sugarcane growers in harvesting their crops,  dropped  by over twenty percent.  Mentions decrease in cost 
(D) Many small sugarcane growers joined together to form an association of sugarcane producers and began to  buy  supplies  at low group rates .  Mentions decrease in cost 
(E) Rainfall in sugarcane-growing regions was higher than it had been during the previous year, allowing the growers  to save money  on expensive artificial irrigation.  Mentions decrease in cost. 
 Option A

abhimahna · Answer

Sugarcane Demand has not increased. Price and Production amount have been stable. Still, More profits. :shock:

Now, we can find out the options that explains this shocking story. Left over would be our answer.

(A) Many countries that are large consumers of sugarcane increased their production of sugarcane-based ethanol. yet their overall consumption decreased. Yeah. This is not explaining what happened. So, Correct. (B) Sugarcane growers have saved money on wages by switching from paying laborers an hourly wage to paying them by the amount harvested. : Ohh.. So, they saved something and hence, got more profit. Cool. (C) The price of the oil, the major energy source used by sugarcane growers in harvesting their crops, dropped by morethan 20%. Same as B (D) Many small sugarcane growers joined together to form an association of sugarcane producers and began to buy supplies at low group rates. Same as B (E) Rainfall in sugarcane-growing regions was higher than it had been during the previous year, allowing the growers to save money on expensive arificial irrigation. Same as B

KungFuGmat · Answer

Here is how I solved:

Argument: Sugarcane profits up by 10%. yet production and demand are stable.

Pre thinking

We have to find all answers EXCEPT one that does not strengthen. It doesn't necessarily have to weaken it could have no impact.

To the original argument...

If Profits are up and demand is not, then it leaves us with costs. The costs MUST have reduced to bring profits up.

According to CR Bible, in many such arguments, correct answer could be placed @ A. Because it is the first answer and the test taker is likely to let it go. So I tell myself, be extra careful of A.

That's all.

Read all choices. B,C,D & E all contain reason how costs reduced. Only A has an case where there is NO impact on answer.

Therefore correct answer A.

Sent from my SM-N900 using  GMAT Club Forum mobile app

ArjunJag1328 · Answer

Prediction: Demand for sugarcane would increase
Result: There was no increase in demand
Price & Production: Stable => Sugarcane growers increase their profits by more than 10% over the previous year's level.

Any of the following statements, if true about last year, helps to explain the rise in profits EXCEPT:

(A) Many countries that are large consumers of sugarcane increased their production of sugarcane-based ethanol, yet their overall consumption of sugarcane decreased. 
Explanation: This is the only option that does not explain the rise in profit. - CORRECT

(B) Sugarcane growers have saved money on wages by switching from paying laborers an hourly wage to paying them by the amount harvested.
Explanation: By saving money on wage, it is possible to increase their profit. - INCORRECT

(C) The price of oil, the major energy source used by sugarcane growers in harvesting their crops, dropped by over twenty percent.
Explanation: Price of oil dropped by 20%. Yes, it is possible to increase their profit. - INCORRECT

(D) Many small sugarcane growers joined together to form an association of sugarcane producers and began to buy supplies at low group rates.
Explanation: Bought supplies at low group rates. Yes, it is possible to increase their profit. - INCORRECT

(E) Rainfall in sugarcane-growing regions was higher than it had been during the previous year, allowing the growers to save money on expensive artificial irrigation.
Explanation: Saved money on expensive artificial irrigation. Yes, it is possible to increase their profit. - INCORRECT

Andrewcoleman · Answer

Does anyone have a good way to make sure you are seeing an except question?

I've been missing a few because I proceed as normal, without an except. Perhaps a checklist that they leverage on each question?

ExpertsGlobal5 · Answer

Dear Friends,

Here is the detailed explanation to this question-

Mind-map:  Sugarcane demand has not risen → prices and production remained constant → yet, growers made more profit.

Missing link:  Between constant demand/ price/ production of sugarcane and the conclusion that growers made more profit.

Expectation from the correct answer choice:  To not explain the reason for the rise in profits.

Choice A:  This answer choice focuses on the demand and supply of sugarcane; while the increased production of sugarcane-based ethanol meant an increased supply of sugarcane for such production,  the overall consumption of sugarcane decreased; a situation of oversupply does not help explain why the profits of the sugarcane growers grew ; logically, a situation of oversupply must lead to a decrease and not increase in profits. As this answer choice does NOT explain the reason for higher profits, it is a fine answer choice. 
 Choice B:  This answer choice suggests that by saving money on wages, the sugarcane growers were able to lower costs and amass greater profits; hence, it is a fine explanation for the rise in profits and does not qualify as the correct answer choice. 
 Choice C:  This answer choice indicates that the drop in the price of oil helped the sugarcane growers lower the cost of producing the crop and thereby amass greater profits; thus, it is a valid explanation for the rise in profits and is not the correct answer choice. 
 Choice D:  This answer choice implies that by forming an association and buying supplies at wholesale rates (or, in bulk), the growers were able to reduce costs and make higher profits; hence, it provides a reason for the rise in profits and is not a fine answer choice. 
 Choice E:  This answer choice suggests that by saving money on expensive artificial irrigation, the growers were able to reduce costs and make higher profits; thus, it is a fine explanation for the increase in profits and is not the correct answer choice.

Hence, A is the best answer choice.

To understand the concept of “Characteristics of an Explanation Statement on GMAT Critical Reasoning”, you may want to watch the following video (~2 minutes):

https://www.youtube.com/watch?v=GZTmOJDZLPo

All the best!
Experts' Global Team

GmatKnightTutor · Answer

Remember to be clear what you are looking for, people. Also go through and knock out all the answer choices. It's clear that a common theme running through the eliminations in this one is costs becoming lower for some reason or the other.

unraveled · Answer

Andrewcoleman 
Its as usual except for the fact that if you understood the argument correctly and unfortunately skipped the EXCEPT part in question stem, you can observe that you have four answers that are correct and one incorrect. Here itself you should know, a red flag kind of situation, that there can't be four correct answer. So what for you is incorrect is actually the right answer.

This is true only when you understood the argument fully - an odd one out situation.

Please note that this is not an strategy and for hard questions this might not even be that because understanding the argument part in itself is hard.

rsmalan · Answer

Hello everyone This is one interesting Critical Reasoning question that asks for the exception to be found. Understanding the passage: Contrary to earlier predictions, demand for sugarcane has not increased in recent years. >>> Demand for sugarcane has not increased in recent years Yet, even though prices and production amounts have also been stable during the last three years, sugarcane growers last year increased their profits by more than ten percent over the previous year's level. >>>Prices and production has been stable during 3 years >>> Still, growers of sugarcane increased profits by 10% over previous year's level. Question stem: Any of the following statements, if true about last year, helps to explain the rise in profits EXCEPT : That is, except one option, all others will support the explanation for rise in profits. The exception is the correct answer. Answer Choice Analysis: (A) Many countries that are large consumers of sugarcane increased their production of sugarcane-based ethanol, yet their overall consumption of sugarcane decreased. Out of scope This option is not correlated with profits of sugarcane growers. Thus, this is the correct answer. (B) Sugarcane growers have saved money on wages by switching from paying laborers an hourly wage to paying them by the amount harvested. Explains rise in profit. This option explains how growers saved money to increase their profits. (C) The price of oil, the major energy source used by sugarcane growers in harvesting their crops, dropped by over twenty percent. Explains rise in profit. Drop in price of oil explains the decrease in input cost to increase the profits of growers. (D) Many small sugarcane growers joined together to form an association of sugarcane producers and began to buy supplies at low group rates. Explains rise in profit. This option also explains how sugarcane growers decreased their input costs by buying supplies at lower collective prices. (E) Rainfall in sugarcane-growing regions was higher than it had been during the previous year, allowing the growers to save money on expensive artificial irrigation. Explains rise in profit. Higher rainfall decreased the need for expenditure on artificial irrigation. Therefore, correct answer is (A) I want to share here that CR is not an easy section to handle. I myself struggled a lot back in time. Things changed when I joined e-GMAT's verbal course. I was able to better apply techniques for elimination of incorrect choices. Scholaranium was icing on the cake. This played a huge part in my journey from V27 to V41 . I encourage you to see my journey in CR through the following link https://www.youtube.com/watch?v=gH5XdVgO3bc&t=40s Pls share your thoughts guys. Thanks. STAY HUNGRY, STAY FOOLISH!!!

KarishmaB · Answer

Price and production of sugarcane has been stable. (This means the revenue has remained stable)
Yet, profit has increased.

What does this mean? How can you explain this? If revenue has remained same but profit has increased, it means cost must have decreased. 
Profit = Revenue - Cost

It is an except explain question. So the options will tell us how the cost to the farmer has reduced. The option that does not tell us about reduced cost will not explain the situation and will be the answer.

(A) Many countries that are large consumers of sugarcane increased their production of sugarcane-based ethanol, yet their overall consumption of sugarcane decreased.

This tells us that for many countries overall consumption of sugarcane decreased. But out premises tell us that price and production have remained stable. If consumption has decreased, it doesn't explain increase in profits. If consumption has remained the same because consumption in other countries has increased, it still doesn't explain increase in profits. This option does not talk about how cost has reduced. As discussed, this is our answer.

(B) Sugarcane growers have saved money on wages by switching from paying laborers an hourly wage to paying them by the amount harvested.

Wages reduced so cost reduced.

(C) The price of oil, the major energy source used by sugarcane growers in harvesting their crops, dropped by over twenty percent.

Input cost reduced so cost reduced.

(D) Many small sugarcane growers joined together to form an association of sugarcane producers and began to buy supplies at low group rates.

Supply cost reduced to cost reduced.

(E) Rainfall in sugarcane-growing regions was higher than it had been during the previous year, allowing the growers to save money on expensive artificial irrigation.

Irrigation cost reduced so cost reduced.

Answer (A)

MasteringGMAT · Answer

Hi  Bunuel   GMATNinja   DmitryFarber

Need some clarity wrt option 'A'.

Beside relying on overall cost decline which is the most evident sign that help resolve the discrepancy, Can we not make a fair assumption that a fuel product, yielded from increased production of sugarcane, would have resulted in the higher profit ? This is the only reason I eliminated this option.

GMATNinja · Answer

Take another look at (A):
 
(A) gives us some details about  how  certain countries are using sugarcane -- they're increasingly producing ethanol. But then we learn that these countries' "overall consumption of sugarcane  decreased ." In other words, they're shifting some sugarcane usage toward ethanol, but overall they're still using LESS sugarcane than they did previously.

This is why (A) doesn't explain the rise in profits. If these countries are using less sugarcane, then we'd expect lower sales of sugarcane, and thus lower profits.

(A) is the correct answer.

I hope that helps!

gmatpro15 · Answer

Price and production of sugarcane has been stable. (This means the revenue has remained stable)
Yet, profit has increased.

So , only option with decrease in profit is option A

stackskillz · Answer

Conclusion  - Even though demand, production and prices of sugarcane has been stable for last 3 years, sugarcane growers last year increased their profits by more than ten percent over the previous year's level.
 Type  - Strengthen (Except)

(A)  Many countries that are large consumers of sugarcane increased their production of sugarcane-based ethanol, yet their overall consumption of sugarcane decreased.  - If the overall consumption of sugarcane decreased as a result of partly using sugarcanes for creating ethanol, this should lead to an overall drop in revenue. However, that doesn't tell us how the producers made an extra 10% profit over last year.  Keep

(B)  Sugarcane growers have saved money on wages by switching from paying laborers an hourly wage to paying them by the amount harvested.  - Decrease in cost. Strengthens the conclusion -  Drop

(C)  The price of oil, the major energy source used by sugarcane growers in harvesting their crops, dropped by over twenty percent.  Decrease in cost. Strengthens the conclusion -  Drop

(D)  Many small sugarcane growers joined together to form an association of sugarcane producers and began to buy supplies at low group rates.  Decrease in cost. Strengthens the conclusion -  Drop

(E) Rainfall in sugarcane-growing regions was higher than it had been during the previous year, allowing the growers to save money on expensive artificial irrigation.

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Contrary to earlier predictions, demand for sugarcane has not increase

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GMAT Critical Reasoning (CR) Questions

Contrary to earlier predictions, demand for sugarcane has not increase

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