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GMAT tomorrow - need AWA feedback my friends!

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Below are the questions I responded to and my answer. Any help would be muchly appreciated, this is my first shot at the AWAs and my GMAT is tomorrow!!!

AWA Argument

The following appeared as part of an annual report sent to stockholders by Olympic Foods, a processor of frozen foods:
“Over time, the costs of processing go down because as organizations learn how to do things better, they become more efficient. In color film processing, for example, the cost of a 3-by-5-inch print fell from 50 cents for five-day service in 1970 to 20 cents for one-day service in 1984. The same principle applies to the processing of food. And since Olympic Foods will soon celebrate its 25th birthday, we can expect that our long experience will enable us to minimize costs and thus maximize profits.”
Discuss how well reasoned . . . etc.


Olympic Foods has stated that, ‘Over time, costs of processing go down as as organisations learn how to do things better’, to demonstrate that Olympic Food’s long experience will result in minimized costs and maximized profits for the company. This argument is flawed for three key reasons. The parallel example used is for a technological process which is distinguished from a food process. The logical end is profit maximisation which does not consider other factors which impact profits, such as competition. Finally, while the initial premise is correct in regards to continuous process improvement, there is no justification as to how this is manifested in the Olympic Foods factory.

Firstly, the technological process discuss has some important differences to the processing of food. The argument uses the reduction in film processing times and price over a 14 year period, from 170 to 1984, to indicate that significant savings in costs of processing can be made over long periods. However, cameras were a relatively niche and expensive technology in 1970, and the popularity of cameras and film increased significantly in the period referred to, which brought with it a large increase in demand for film processing. Hence, the cost reduction implied by the price decrease may be partly due to scale, and partly due to production efficiencies. The Olympic Foods example does not mention any scale advantages – also, it is unlikely that the demand for food has increased as exponentially as the demand for film.

Secondly, Input prices are also a factor in evaluating the relevance of the film processing parallel. The price of the paper for printing photos also dropped substantially over the period, due to massive increases in demand and efficiencies in the process for manufacturing the photo paper. Conversely, the price of food has been steadily increasing over the last 50 years. The factors make the film processing example a poor analogy to argue that the cost of producing food is lower.

Thirdly, the final stage of the argument in the Olympic Foods annual report implies that cost minimization is the key factor in maximization of profits. Some other key items that affect profits have been excluded, such as levels of competition, price of available substitutes and consumer demand.

In conclusion, while Olympic Foods may have reduced its food processing costs over the last 25 years, the statements in the annual report extract do not substantiate this. The example given regarding film processing is poorly linked to the Olympic Foods business and no relevant example from the business itself is included – which would improve the argument substantially. A full description of the relevant market conditions, and the relative performance Olympic Foods against competitors would prove more substantive evidence to argue that Olympic Foods has improved processing costs. Based on this argument, it is unlikely that stockholders will be convinced that Olympic Foods’ long history will have a direct impact on its overall performance.

AWA - Issue

“In some countries, television and radio programs are carefully censored for offensive language and behavior. In other countries, there is little or no censorship.”
In your view, to what extent should government or any other group be able to censor television or radio programs?
Explain, giving relevant reasons and/or examples to support your position.


Governments or other groups should only be able to censor television or radio to a limited extent. Free speech must be protected by a nation’s media outlets, but offensive language and behaviour can have a negative effect on the behaviour of the population, or some segments of the population, if no censoring occurs. The people watching television cannot always be trusted to make the best decisions on what they should watch. Television and radio are often examples to the rest of the population and maintaining a level of decency and some moral standards in this programming will benefit the population as a whole.

Firstly, society is highly influenced by what is on TV and radio. There have been several examples of ‘copycat’ style offences, where the initial event is publicised or first shown on the TV or heard on the radio. The proliferation of media in mainsteam society provides easy access for anyone to these entertainment devices. Overly violent movies can provide the necessary impetus for a person to commit a crime, and the likelihood of the event being televised makes committing a crime even more appealing for some people. There have been instances where violent criminals have cited television programs or movies as a factor in their criminal actions.

Other members of society are equally affected by indiscriminate access to violence and offensive behaviour. Children has limited ability to discern right from wrong, and during their formative years appropriate behaviour must be encouraged to create good habits and strong morals in children. Seeing violent police shows, swearing and fighting on television may give the impression that this behaviour is acceptable in society. This could be prevented with some appropriate censorship based on the hours that some television shows are programmed, as is the case in Australia, where violent movies are only allowed on television late at night. It could be argued that parents should have the responsibility for monitoring their children’s television viewing habits, but occasionally parents are not available to play this role.

Finally, television and radio have an important role in promoting the ideals of a society. Having programming with strong values and morally upstanding characters can help promote the overall behaviour of a society. Mormons, for example, do not have televisions in their society because they are trying to promote a certain standard of behaviour that is not supported by modern television programming. Radio shock jocks, like John Laws in Australia, have the impact of lowering the general standards of the population in terms of their boundaries for disgusting and obscene behaviour, by promoting this behaviour on the radio. This effectively desensitizes the public to this obscene behaviour and makes it more acceptable and less shocking in everyday life. If Governments could censor this type of radio show, the public would be less likely to view obscene behaviour as an acceptable standard.

There is definitely such thing as going too far, when free speech is limited. The ideal framework for censorship is one that is voted for an approved by the general population, which takes into account some different levels of censorship, and generally promotes free speech where it is not obscene or offensive. Australia has a very effective ‘Code of Practice’ model that requires licensing for radio shows and hands out fines to offending shows that breach the Code of Practice. Television shows are also assessed on this framework and required to maintain standards, with more relaxed standards at different times of the day – such as late at night, when children are unlikely to be watching television. Appropriately applied, censorship of television and radio programs is favourable and appropriate, and can benefit the community as a whole.

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New post 24 Aug 2009, 02:26
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Love the Argument essay - enjoyed reading it. Great job and a great topic - what a flaw!
I would dedicate a bit more time to your point #3 - that one seems to be a big flaw of its own that could be developed even further and also make the third paragraph look not so short. Only suggestion I have is to use "For example" or "For instance" - those are some of the trigger words that booth a human reader and computer like. You could easily plug them in, for example in the area where you mentioned photo paper price decrease.
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New post 24 Aug 2009, 06:09
Thank you! I will include these points. Will report back in the 'Share your Experience' thread...

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New post 24 Aug 2009, 09:16
sapphireka wrote:
Thank you! I will include these points. Will report back in the 'Share your Experience' thread...

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Thanks! We'll be waiting :gl
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New post 25 Aug 2009, 21:48
How did you do?
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Could someone please evaluate my essay below and let me know where I could improve.
The following appeared in a memorandum from the business department of the Apogee Company:
When the Apogee Company had all its operations in one location, it was more profitable than it is today. Therefore, the Apogee Company should close down its field offices and conduct all its operations from a single location. Such centralization would improve profitability by cutting costs and helping the company maintain better supervision of all employees.”

The argument made by the business department of Apogee Company that “centralization would improve profitability” is unjustified. There are other critical factors that need to be closely examined and taken into account, when making such an assumption. Profitability of a company depend on a varied number of contributors such as quality of deliverables, size of the customer base, how well placed Apogee is against its competitors, how low-priced its products and services offered are, and so on. Reducing operating costs by centralizing office location is just one dimension of the profitability paradigm and cannot be fully credited to improve profits.

Firstly, one could argue about the period when Apogee Company had its operations in one location. No supporting evidence has been provided. The writer could be referring to Apogee’s initial years as a start-up. So even though Apogee did not have multiple foot-prints at that time, profits could have been made, because of its innovative concept or superior service or a combination of some other drivers.
The argument still holds, even with the assumption that the period referred by the writer, was not Apogee’s initial years. Apogee could have been the only player in its area of business it supported. In this case of monopoly, profits can be realized, with sheer volume and a small margin on sales.

Secondly, the proposal to close all field offices and operate from a single location could have an adverse effect on Apogee’s business. Globalization has called for every company to have a wide-spread presence to reach to more customers and keep-up with competition. While technology enables online operations, it still holds true that certain businesses depend on human interaction and close association with the locals. The risks associated with lack of dispersion should be understood.
As an example, AT&T has virtually every service and product available for its customers online. However, it still operates with thousands of retail stores and more offices to make sure users get to interact with fully functioning products and avail real-time experience with its representatives. AT&T has had a steady growth over the past few years.
Therefore, Apogee may lose to its competitors, on accessibility, customer satisfaction, diversity and community engagement by closing its field offices.

Thirdly, the cost decrease by centralization does not warranty other expenses. The central location will have to be expanded to accommodate all employees and departments. This may mean re-hiring to find replacements for resources, not willing to relocate. Shipping and handling from various supply-chain partners will be an over-head as well. Delays in delivering goods will hurt the business or will have to be re-strategized. There are more similar expenses that can be listed which will prove disadvantageous to Apogee.

Lastly, the writer seems to give into the delusion that holding employees at a common location can help supervise them better. While this may come with some added benefits in managing worker groups, management bodies of many a firms have found efficient means to increase employee productivity while giving them the flexibility to work from remote locations. This has been a widely accepted practice, given the varied needs and demands of the work force. There are many practices to keep employees engaged at work and measure efficiency and effectiveness. As an example, most meetings these days are conducted via video conferences and remote sharing methods.

Finally, Apogee’s business management should re-evaluate its decision to close its field offices and conduct its operations from a single location. Analysis should be done in many other dimensions to propose a profitable business strategy. Studies should be conducted to assess why Apogee was profitable when it had only one location. There should be substantial evidence acquired and presented to prove that all other factors remain the same and that the single location was the only reason for its profitability. It’s almost unrealistic to be able to prove that, Hence, if the eventual goal is profitability and operational excellence, Apogee should focus on other means.

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New post 18 Jun 2013, 22:13
Very well written! This will be my bar to beat!

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New post 06 Aug 2014, 04:03
1. Over ¬time, the costs of processing of food go down because as organizations learn how to do things better, they become efficient. In color film processing, for example, the cost of a 3-by-5 inch print fell from 50 cents for five day service in 1970 to 20 cents for one day service in 1981. The same principle applies to the processing of food. And since Olympic Foods will soon celebrate its 25th birthday, we can expect that our long experiences will enable us to minimize cost and this maximize profits.
- The argument by the Olympic Foods, the costs of processing of food go down because as the organization learns to do things better, they become efficient may seem logical at first glance. However, it omits some important concerns that must be taken in consideration to provide the information or evidence to prove the argument true. The statement that follows the description of how the costs of processing go down simply describes efficiency of the organization and long experiences of the organization. This does not give a logical argument in favor of the cost processing and it certainly does not provide support or proof of the main argument.
First, the argument assumes learning how to do things better results efficiency, which in turn results in the costs of processing of food go down. Does this mean only learning of how to do things better helps in declining the costs? There may be other various factors for declining of the costs. Suppose, for example, the environment which might be the main reason for the costs declining. The environment plays a vital role in keeping the organization run smoothly. If the internal as well as the external environment is sound then the people working in the organization feel safe and are determined to perform better.
Secondly, the argument also states that the color film processing applies the same principle as the processing of food. In fact, the writer didn't clearly mention about the market. How much do we know about the market? Is there a chance that it is volatile? Moreover, the argument doesn't state that both the processing is measured in the same terms and conditions; it does not state whether the film processing and cost processing are linked with each other. And also there is no clear statement for the price decreasing from 50 cents to 20 cents. Is the price being decreased according to the service it is providing now and then? 50 cents for 5 days and 20 cents for 1 day, the price is decreasing according to the service it is providing for the number of days.
Finally, the argument provides no evidence that long experiences will enable the organization to minimize costs and maximize profits. The argument also did not address how well did the organization perform till 25 years. In its current form, the argument implies that the organization will be running in the same manner every year which will enable them in minimizing costs and maximizing profits. There is no certainty that, what happened in the organization every year will be happening in the same manner always.
The writer would not be wrong to conclude that doing things better they will be efficient and long experiences will enable them to minimize cost and this maximize profits. After all, the experience gained will help in overcoming the distraction or obstacles the organization might get in the near future. But in order to support the current conclusion the writer must first define the scope of the problem more clearly and demonstrate the sort of efficiency and experiences. If it included the items discussed above, the argument would have been more sound and convincing.
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The argument has reasoned that greater experience corresponds to lower cost of operation which can lead to cost minimization and profit maximization, and in order to substantiate this argument the author has considered data from the film processing industry, and has extrapolated the results to assume they would apply to the food processing industry as well. Since, the argument has failed to consider other factors that lead to profit maximization and cost minimization, and because it has made a conclusion based on performance of an unrelated and an altogether different industry, this argument is fundamentally flawed.

Firstly, the argument has stated that Olympic Foods will be able to minimize costs and maximize of profits simply because of its 25 years of experience. It has not stated as to how exactly the company is going to achieve this feat. Cost minimization is definitely not dependent just on experience. It depends on factors like the prevalent rates of rent and maintenance, the cost and availability of land and labor, and the cost and supply of raw material. The argument does not state how Olympic Foods is going to control the cost and availability of these items. On the other hand profit maximization not just requires experience and cost minimization, it also requires demand for the product, economies of scale, well established supply chain, a good selling price etc. which the argument has not mentioned anything about. Moreover, the argument fails to mention competition as one of the most important factors responsible for price determination. The film processing industry during the said time may have been able to reduce costs as a result of reduction of input costs and the increasing popularity of photography which may have increased the demand of related products like cameras, films, chemicals etc. which in turn may have increased their production and due to economies of scale the production costs may have gone down resulting in a cascading effect on the whole industry as such. The argument has not presented any data pertaining to the demand for the products produced by Olympic Foods, or any other food processing company for that matter, and has not even said whether there is any likelihood for an increased demand for the same in the near future.

Secondly, while the argument may be right in assuming increased efficiency, technological advancement etc. as a factor responsible for reduced cost of film processing. It however fails to mention any such technological advancement made by Olympic Foods, or any other food processing company, that can bring about a similar effect with respect to its own products. Thirdly, the film processing industry is not affected by seasonal constraints and vagaries of nature as the food processing industry is. One unforeseen rainfall during harvesting season may ruin the entire wheat crop and call for imports which may take time and money thus affecting everything else downstream. For such reasons it is not plausible to extrapolate and draw conclusions for the performance of the food processing industry or Olympic Foods based on the performance of the film processing industry thereto.

All in all, the argument suffers from some serious flaws and if it incorporates the above-discussed points, it can be improved and thus be made more cogent.

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New post 28 Mar 2015, 01:58
Firstly, I liked both your essays. I surely think they were a 5 each.
Having said that, I have a question.
Is it okay, if we refer to instances specific to one's geographical location ? I am asking this coz its very possible that the human evaluationist would not be so familiar with the RJs from Australia in the 2nd essay above. Hence there is no way he can say whether the info you are referring to is valid or not.

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New post 22 Aug 2016, 02:46
The argument above says that processing costs reduce with time due to increase in efficiency. The example of color film processing is taken and applied to food proceesing as well. With this data and lot of unreasonable assumptions, the report forecasts the minimal cost and maximum profit scenario.

Primarily, the report claims that the costs of processing go down with time since efficiency will improve with time. But the assumption underlying this statement is that the other costs such as maintenance costs, operating costs and other factors do not change. There is no information regarding the necessary measures taken to address the maintenacnce issues of macihincery or staff.
It is possible that machines will become old and wear down requiring a lot of maintenance and replacement may not be an available option, increasing costs of processing.

The author took an example of color film processing where cost of print reduced with certain time period and assumes that similar reduction can help to reduce costs and improve profits. But the flaw of the example can be seen if 50 cents per five days is equivalent to 10 cents per day whereas the second price is 20 cents per day which is higher than the initial one. While there can be plenty of factors which can result in this scenario and this increase need not be a damaging one, The decrease cannot be taken as an instance to make the argument valid.

Moreoever, While the above example does not make sense by itself, it can hardly apply for processing of food. Food processing also involves other factors such as food storage, contamination and other factors. With no such information, it is not feasible to make any assumptions and make a conclusion that only long experience will enable cost minimization and profit maximization.

The argument needs to consider many factors such as maintenenace costs, labour and maintenance cost conditions before making conclusion. Inorder to make profits, demand needs to increase and customer feedbacks are needed to make necessary changes. Moreover new changes may be needed to stay in demand in market and those may need further investment. Hence all these factors are required to support our conclusion without which the argument as is sounds completely absurd.
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New post 24 Jun 2017, 22:53
Nevernevergiveup wrote:
The argument above says that processing costs reduce with time due to increase in efficiency. The example of color film processing is taken and applied to food proceesing as well. With this data and lot of unreasonable assumptions, the report forecasts the minimal cost and maximum profit scenario.

Primarily, the report claims that the costs of processing go down with time since efficiency will improve with time. But the assumption underlying this statement is that the other costs such as maintenance costs, operating costs and other factors do not change. There is no information regarding the necessary measures taken to address the maintenacnce issues of macihincery or staff.
It is possible that machines will become old and wear down requiring a lot of maintenance and replacement may not be an available option, increasing costs of processing.

The author took an example of color film processing where cost of print reduced with certain time period and assumes that similar reduction can help to reduce costs and improve profits. But the flaw of the example can be seen if 50 cents per five days is equivalent to 10 cents per day whereas the second price is 20 cents per day which is higher than the initial one. While there can be plenty of factors which can result in this scenario and this increase need not be a damaging one, The decrease cannot be taken as an instance to make the argument valid.

Moreoever, While the above example does not make sense by itself, it can hardly apply for processing of food. Food processing also involves other factors such as food storage, contamination and other factors. With no such information, it is not feasible to make any assumptions and make a conclusion that only long experience will enable cost minimization and profit maximization.

The argument needs to consider many factors such as maintenenace costs, labour and maintenance cost conditions before making conclusion. Inorder to make profits, demand needs to increase and customer feedbacks are needed to make necessary changes. Moreover new changes may be needed to stay in demand in market and those may need further investment. Hence all these factors are required to support our conclusion without which the argument as is sounds completely absurd.


Hi,

In the argument, the example given says the cost of a 3 by 5 inch print fell from 50 cents for five day service in 1970 to 20 cents for one day service in 1984. This means from 10 cents to 20 cents per day service. Correct?
In this case the example shows the cost has risen which is a discrepancy acc to me. But looks like i'm missing something here. Can you please comment?

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New post 28 Jun 2017, 15:13
Chef wrote:
Nevernevergiveup wrote:
The argument above says that processing costs reduce with time due to increase in efficiency. The example of color film processing is taken and applied to food proceesing as well. With this data and lot of unreasonable assumptions, the report forecasts the minimal cost and maximum profit scenario.

Primarily, the report claims that the costs of processing go down with time since efficiency will improve with time. But the assumption underlying this statement is that the other costs such as maintenance costs, operating costs and other factors do not change. There is no information regarding the necessary measures taken to address the maintenacnce issues of macihincery or staff.
It is possible that machines will become old and wear down requiring a lot of maintenance and replacement may not be an available option, increasing costs of processing.

The author took an example of color film processing where cost of print reduced with certain time period and assumes that similar reduction can help to reduce costs and improve profits. But the flaw of the example can be seen if 50 cents per five days is equivalent to 10 cents per day whereas the second price is 20 cents per day which is higher than the initial one. While there can be plenty of factors which can result in this scenario and this increase need not be a damaging one, The decrease cannot be taken as an instance to make the argument valid.

Moreoever, While the above example does not make sense by itself, it can hardly apply for processing of food. Food processing also involves other factors such as food storage, contamination and other factors. With no such information, it is not feasible to make any assumptions and make a conclusion that only long experience will enable cost minimization and profit maximization.

The argument needs to consider many factors such as maintenenace costs, labour and maintenance cost conditions before making conclusion. Inorder to make profits, demand needs to increase and customer feedbacks are needed to make necessary changes. Moreover new changes may be needed to stay in demand in market and those may need further investment. Hence all these factors are required to support our conclusion without which the argument as is sounds completely absurd.


Hi,

In the argument, the example given says the cost of a 3 by 5 inch print fell from 50 cents for five day service in 1970 to 20 cents for one day service in 1984. This means from 10 cents to 20 cents per day service. Correct?
In this case the example shows the cost has risen which is a discrepancy acc to me. But looks like i'm missing something here. Can you please comment?

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The service is measured as cost per day. Its measured by speed similar to shipping packages. It used to cost 50 cents and you had to wait 5 days, now it costs 20cents and you get the prints the same day.
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New post 23 Oct 2017, 13:07
The argument states that as the organizations learn to do things better over a period of time, the costs of processing go down. The same principle applies to the processing of food. As a result the organization, Olympic foods, will cut down its processing costs thereby maximizing its profits. Stated in this way the argument manipulates facts and presents a distorted view of the situation. The argument also fails to bring into picture various facts on the basis of which it can be evaluated better. Thus the argument is weak, flawed and open to debate.

First, the argument states that costs of processing goes down as organisation learn to do things better and become efficient. This statement is a stretch because it fails to take into consideration the effects of inflation. It’s true that improving efficiency primarily by employing latest technology leads to an increase in efficiency but it doesn’t necessarily mean that the processing costs will come down. The factors such as increase in costs of raw materials increase in labour costs, maintenance costs have not been considered. The argument would have been much clearer if it had analysed the effects of the increase in the costs of these parameters.

Second, the argument cites an example of the drop in processing cost of colour film processing over the years and tries to make a similar correlation with the food processing industry. This is again a flawed comparison as both businesses are entirely different from one another. The trend in one industry doesn’t necessarily apply to another. For example, the advancements in technology have made various electronic appliances cheaper and easy to procure but on the other hand the advancement in technology has led to an advancement in the field of medical science, leading to development of various modern day cures which have driven up the medical expenses. Hence, the comparison between food processing and film processing is not an apt one. The argument would have made more sense if the author presents greater details about the changes in costs of various parameters governing the food industry to provide a clear overall picture of the resultant costs.

Finally the argument concludes that the long experience of Olympic foods will lead to a maximization of its profits. This is again an example of poor reasoning as we are not aware of the organisation’s past. Information regarding the level of satisfaction of the customers, the capability of the employees, the efforts of the research and development team in innovating things etc. has not been provided. Without this information the argument remains unsubstantiated. Thus the conclusion has no legs to stand.

The argument is therefore more of a wishful thinking rather than substantiated evidence. Since the argument provides examples of leap of faith and poor reasoning, it remains flawed and open to debate.

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GMAT tomorrow - need AWA feedback my friends!   [#permalink] 23 Oct 2017, 13:07
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