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Holdens Ltd. two subsidiaries performed with remarkable consistency ov

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Holdens Ltd. two subsidiaries performed with remarkable consistency ov  [#permalink]

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21 Oct 2019, 21:28
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74% (01:50) correct 26% (02:07) wrong based on 82 sessions

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Competition Mode Question

Holdens Ltd. two subsidiaries performed with remarkable consistency over the past five years: in each of those years, Lexton has accounted for roughly 30 percent of dollar sales and 60 percent of profits, and Still more for the balance.

Which of the following can properly be inferred regarding the past five years from the statement above?

A. Total dollar sales for each of the subsidiaries have remained roughly constant.
B. Lexton has faced stiffer competition in its markets than hasStill more.
C. Still more has realized lower profits per dollar of sales than has Lexton.
D. The product mix offered by each of the company's divisions has remained unchanged.
E. Highly profitable products accounted for a higher percentage of Stillmore's sales than of those of Lexton.

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Re: Holdens Ltd. two subsidiaries performed with remarkable consistency ov  [#permalink]

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21 Oct 2019, 22:33
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C.Still more has realized lower profits per dollar of sales than has Lexton.....It's clearly inferred from the data provided....Lexton has accounted for roughly 30 percent of dollar sales and ""60 percent of profits"".....

OA:C

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Re: Holdens Ltd. two subsidiaries performed with remarkable consistency ov  [#permalink]

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22 Oct 2019, 01:19
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Let the total dollar sales = D & Total profits = P

Profits per dollar of Lexton = $$\frac{0.60*P}{0.30*D}$$ = $$\frac{2P}{D}$$
Profits per dollar of Still more = $$\frac{0.40*P}{0.70*D}$$ = $$\frac{4P}{7D}$$
--> Still more has lower profits per dollar than Lexton

IMO Option C
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Re: Holdens Ltd. two subsidiaries performed with remarkable consistency ov  [#permalink]

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22 Oct 2019, 02:55
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conclusion Lexton has accounted for roughly 30 percent of dollar sales and 60 percent of profits and still more has 70 percent of dollar sales and 40 percent of profits

IMO C; Still more has realized lower profits per dollar of sales than has Lexton

Holdens Ltd. two subsidiaries performed with remarkable consistency over the past five years: in each of those years, Lexton has accounted for roughly 30 percent of dollar sales and 60 percent of profits, and Still more for the balance.

Which of the following can properly be inferred regarding the past five years from the statement above?

A. Total dollar sales for each of the subsidiaries have remained roughly constant.
B. Lexton has faced stiffer competition in its markets than hasStill more.
C. Still more has realized lower profits per dollar of sales than has Lexton.
D. The product mix offered by each of the company's divisions has remained unchanged.
E. Highly profitable products accounted for a higher percentage of Stillmore's sales than of those of Lexton.
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Re: Holdens Ltd. two subsidiaries performed with remarkable consistency ov  [#permalink]

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22 Oct 2019, 05:11
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The answer is option C in my view.

Preambles: Holdens Ltd has two subsidiaries, and they performed with remarkable consistency over the past five years.
Each year Lexton accounts for about 30% of dollar sales and 60% of profits with Stillmore accounting for the rest.
Implying Stillmore accounts for about 70% of dollar sales and 30% of profits.

Option A: Total dollar sales for each of the subsidiaries have remained roughly constant. This is not necessarily true based on the information provided. The total dollar sales can be different in each of the five years but what we know is that Lexton accounts for 30% of the total sales and Stillmore accounts for 70%. Eliminate A.

B. Lexton has faced stiffer competition in its markets than has Stillmore. There is no information to suggest that Lexton faced stiffer competition compared with Stillmore per the argument. Eliminate option B.

C. Stillmore has realized lower profits per dollar of sales than has Lexton. Correct. From the information provided, we can make a valid deduction that Stillmore realized lower profits per dollar of sales. This is because Stillmore's sales account for 70% of dollar sales while its profitability represents 40% of the total profits. It is therefore a valid deduction to make since these ratios are in reference to the total sales volume and profits of Holden Ltd.

D. The product mix offered by each of the company's divisions has remained unchanged. Irrelevant to the argument. Eliminate D.

E. Highly profitable products accounted for a higher percentage of Stillmore's sales than of those of Lexton. This is not a valid deduction from the information provided in the argument. In any case despite the fact that Stillmore's total sales are 70% of the total sales volume, its profits account for 30% of the total profits, hence it does not make much sense to say that highly profitable products account for a higher percentage of Stillmore's sales than Lexton. Eliminate E as well.
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Re: Holdens Ltd. two subsidiaries performed with remarkable consistency ov  [#permalink]

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22 Oct 2019, 05:26
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Quote:
Holdens Ltd. two subsidiaries performed with remarkable consistency over the past five years: in each of those years, Lexton has accounted for roughly 30 percent of dollar sales and 60 percent of profits, and Stillmore for the balance.

Which of the following can properly be inferred regarding the past five years from the statement above?

A. Total dollar sales for each of the subsidiaries have remained roughly constant.
B. Lexton has faced stiffer competition in its markets than has Stillmore.
C. Stillmore has realized lower profits per dollar of sales than has Lexton.
D. The product mix offered by each of the company's divisions has remained unchanged.
E. Highly profitable products accounted for a higher percentage of Stillmore's sales than of those of Lexton.

ARGUMENT
[con] Holdens two subs have performed consistently over the past years;
[prem] Lexton has accounted for 30% sales and 60% profits;
[prem] Stillmore for the balance - I assume this means it accounted for the remaining 70% sales and 40% profits;
[asum] Lexton accounted for a greater profit per sales dollar than Stillmore, since it sold less and profited more.

INFER
A. "sales have remained constant" not necessarily;
B. "L has stiffer competition x S" cannot be inferred;
D. "mix has remained unchanged" cannot be inferred;
E. not necessarily…;

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Re: Holdens Ltd. two subsidiaries performed with remarkable consistency ov  [#permalink]

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22 Oct 2019, 06:18
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Lexton — 30% of dollar sales and 60% profits

Stillmore —50% of dollar sales and 50% profits

It’s inferred that Still more has lower profits per dollar of sales than a Lexton.

Only C matches the solution

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Holdens Ltd. two subsidiaries performed with remarkable consistency ov  [#permalink]

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Updated on: 22 Oct 2019, 21:26
1
Quote:
Holdens Ltd. two subsidiaries performed with remarkable consistency over the past five years: in each of those years, Lexton has accounted for roughly 30 percent of dollar sales and 60 percent of profits, and Still more for the balance.

Which of the following can properly be inferred regarding the past five years from the statement above?

A. Total dollar sales for each of the subsidiaries have remained roughly constant.
B. Lexton has faced stiffer competition in its markets than has Still more.
C. Still more has realized lower profits per dollar of sales than has Lexton.
D. The product mix offered by each of the company's divisions has remained unchanged.
E. Highly profitable products accounted for a higher percentage of Still more's sales than of those of Lexton.

Let the total sales in the last 5 years be s and profit be p.

So, sales by Lexton=0.3s, so sales by Stillmore=0.7s
Similarly, profit by Lexton=0.6p, so profit by Stillmore=0.4p

Now, profit/(dollar sales) of Lexton= 0.6p/0.3s=2p/s and proft/(dollar sale) of Stillmore=0.4p/0.7s=4p/7s

Clearly, Lexton has a higher profit/(dollar sales) than Stillmore.

Therefore, option C fits with our understanding above, and thus is the correct answer.

Option A is wrong as we have no information on year by year sales of each company in each of the 5 years. We only have the data on proportion of sales for each company during this time.

Clearly, option B and D are out of scope.

Option E is wrong because we have no information to check the validity of this statement.

Originally posted by iamsiddharthkapoor on 22 Oct 2019, 07:18.
Last edited by iamsiddharthkapoor on 22 Oct 2019, 21:26, edited 1 time in total.
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Re: Holdens Ltd. two subsidiaries performed with remarkable consistency ov  [#permalink]

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22 Oct 2019, 08:48
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Holdens Ltd. two subsidiaries performed with remarkable consistency over the past five years: in each of those years, Lexton has accounted for roughly 30 percent of dollar sales and 60 percent of profits, and Still more for the balance.

Which of the following can properly be inferred regarding the past five years from the statement above?

A. Total dollar sales for each of the subsidiaries have remained roughly constant.
B. Lexton has faced stiffer competition in its markets than hasStill more.
C. Still more has realized lower profits per dollar of sales than has Lexton.
D. The product mix offered by each of the company's divisions has remained unchanged.
E. Highly profitable products accounted for a higher percentage of Stillmore's sales than of those of Lexton

The stimulus states the of the subsidiaries
1) Lexton: 30% dollar sales and accounts for 60% profits
2) Still More: 60% dollar sales and accounts for 40% profit

If we look at the above statistics it shows that though still more has more dollar same the profits are low as compared to Lexton

IMO C
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Re: Holdens Ltd. two subsidiaries performed with remarkable consistency ov  [#permalink]

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22 Oct 2019, 21:15
Bunuel wrote:

Competition Mode Question

Holdens Ltd. two subsidiaries performed with remarkable consistency over the past five years: in each of those years, Lexton has accounted for roughly 30 percent of dollar sales and 60 percent of profits, and Still more for the balance.

Which of the following can properly be inferred regarding the past five years from the statement above?

A. Total dollar sales for each of the subsidiaries have remained roughly constant.
B. Lexton has faced stiffer competition in its markets than hasStill more.
C. Still more has realized lower profits per dollar of sales than has Lexton.
D. The product mix offered by each of the company's divisions has remained unchanged.
E. Highly profitable products accounted for a higher percentage of Stillmore's sales than of those of Lexton.

OFFICIAL EXPLANATION

The best answer is C. If Lexton has accounted for roughly 30 percent of dollar sales and 60 percent of profits, then it has realized more profit per dollar of sales than Stillmore. There are not enough facts to support the inferences reached in the other answers.
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Re: Holdens Ltd. two subsidiaries performed with remarkable consistency ov  [#permalink]

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22 Oct 2019, 22:17
Still more had 70% of dollar sales with 40% of profit while Lexton had 30% of dollar sales with 60% of profit. So clearly Still more has realized lower profits per dollar of sales than has Lexton.
Hence Option C.
Re: Holdens Ltd. two subsidiaries performed with remarkable consistency ov   [#permalink] 22 Oct 2019, 22:17
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