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If shoplifting at ToySMart continues at the current rate

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Re: If shoplifting at ToySMart continues at the current rate  [#permalink]

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New post 04 Aug 2018, 22:36
If shoplifting at ToySMart continues at the current rate, the shop's owner will be forced to close the store. Raising the prices of the goods sold at ToySMart by 10% will help make up the shortfall in the store's income; this change will therefore protect ToySMart from having to close.


B. The rise in prices will have no effect on the number of goods sold, even if the rate of shoplifting remains the same. - Incorrect - Negate this -- so the rise in price can have an effect that can range from insignificant to a significant decrease on the number of goods sold.
"no effect " is vague and can refer to an increase or decrease in the number of goods sold


C. The rise in prices will not induce visitors who otherwise would not have shoplifted to shoplift items they can now not afford. - Correct - Negate this and the argument falls apart - the rise in prices will induce more visitors to shoplift


Negation of B - The rise in prices will have an effect on the number of goods sold, even if the rate of shoplifting remains the same.

Generally, if the price of an item increases, then the number of the item sold will decrease.
1. When we negate option B, can we assume that no effect "no effect " is vague and can refer to an increase or decrease in the number of goods sold ?
2. Even if assume that if the price of an item increases, then the number of the item sold will decrease. For option B, we don't know whether the decrease is minuscule or a significant number.

AjiteshArun , GMATNinja , mikemcgarry , egmat , RonPurewal , DmitryFarber , MagooshExpert , ccooley , ChiranjeevSingh, GMATGuruNY , KarishmaB , other experts-- please enlighten

Answer C
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Re: If shoplifting at ToySMart continues at the current rate  [#permalink]

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New post 04 Aug 2018, 22:52
I went with option B because of my pre-thinking. However, B is incorrect. The best strategy for assumption questions is to use the NEGATION strategy and see whether the negated statement destroys the argument, if its true.

Here, for example, Option B says,
Quote:
The rise in prices will have no effect on the number of goods sold, even if the rate of shoplifting remains the same.


Negation of this statement would be - The rise in prices will have an effect on the number of goods sold, even if the rate of shoplifting remains the same.

BUT, The catch here is - WHAT KIND OF EFFECT? Positive or negative? Will the sales go up? or go down? We don't know. The argument still holds true even if the negated statement is true.
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Re: If shoplifting at ToySMart continues at the current rate  [#permalink]

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New post 04 Aug 2018, 23:24
shubham2312 wrote:
maheshaero20 wrote:
If shoplifting at ToySMart continues at the current rate, the shop's owner will be forced to close the store. Raising the prices of the goods sold at ToySMart by 10% will help make up the shortfall in the store's income; this change will therefore protect ToySMart from having to close.

Which of the following is an assumption made in drawing the conclusion above?

B. The rise in prices will have no effect on the number of goods sold, even if the rate of shoplifting remains the same.
C. The rise in prices will not induce visitors who otherwise would not have shoplifted to shoplift items they can now not afford.

i am also facing same question why C is better answer than B.
although i was able to answer the question correctly but my reasoning i think is flawed.
i used the logic sales are not related to shoplifting directly in any way,means out of 2 parts of the option statement one is saying price rise will not have any effect on sales than 2nd statement should present contrast or something of that sort.

someone kindly throw some light on the same.


Hey shubham2312,

I also rounded up to the above two options. Here is my insight on the same -

(B) The rise in prices will have no effect on the number of goods sold, even if the rate of shoplifting remains the same.

Suppose here we assume, that a customer goes in the store and is wanting to buy a puppet for say $20. Now when he goes in, he sees that the puppet which he thought was to be for $20 is now for $22 (increase of 10%). Now his mind says that I want to buy the puppet,even if it for $22, but his pocket says not more than $20 . So his best option would be to buy a smaller puppet that would be equivalent to $20 or less. Now when he buys the same our statement is also consistent with the same number of goods being sold and rate of shoplifting also being the same but still the profits would not have been the same as they were expected to be as we can consider the same scenarios on a much more costlier product of say $500 and that too with many people.

Hence in my opinion because of the above reasoning B is wrong and C is the only remaining answer.

Also I thought of a funnier version of this. What if the shoplifters think that I will lift anything above $21. Now when the price increases. He will lift this puppet as well making the buyer forced to buy the cheaper puppet. :P

Hope this all makes sense. Please let me know in case of any clarifications
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Re: If shoplifting at ToySMart continues at the current rate  [#permalink]

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New post 06 Aug 2018, 16:13
Skywalker18 wrote:
Negation of B - The rise in prices will have an effect on the number of goods sold, even if the rate of shoplifting remains the same.

Generally, if the price of an item increases, then the number of the item sold will decrease.
1. When we negate option B, can we assume that no effect "no effect " is vague and can refer to an increase or decrease in the number of goods sold ?
2. Even if assume that if the price of an item increases, then the number of the item sold will decrease. For option B, we don't know whether the decrease is minuscule or a significant number.

AjiteshArun , GMATNinja , mikemcgarry , egmat , RonPurewal , DmitryFarber , MagooshExpert , ccooley , ChiranjeevSingh, GMATGuruNY , KarishmaB , other experts-- please enlighten

Answer C

Hi Skywalker18,

Yes, all your thinking is exactly correct here :-) While we can assume that here if the price of something increases, the number sold will decrease (if the number sold changes), we don't know the extent of the change. As you said, it might be minuscule, in which case the argument's conclusion still holds. That's why C is the better option :-)

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Re: If shoplifting at ToySMart continues at the current rate  [#permalink]

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New post 11 Aug 2018, 05:24

Official Explanation
Answer = (C).

The owner of ToySMart has a problem with shoplifting causing a loss of profits, which he wants to solve by raising his prices. To make this conclusion, he would have to assume, first of all, that raising his prices would make him more money, which is logical. Second, he would have to assume that raising the prices would not exacerbate the existing problem with shoplifting. (C) best addresses this issue.

The shop owner hasn’t made any assumptions (in this passage, at least) about what people will buy once he raises his prices (A). This is also important in evaluating (B). Note that the passage tells us that if the current rate of shoplifting continues, the store will have to close--if the rate of shoplifting continues, the owner would still be losing money. The higher prices might or might not make up for this shortfall, but we don’t have enough information to evaluate this point.

Choice (D) is irrelevant. In general, most shoppers at any store are wholly ignorant of the profits of the store's owner. It would imply an extremely loyal and personal relationship if the majority of shoppers cared this much about the owner's profits, and there is nothing in the question justifying this sort of bond.

Finally, the effects on other stores (E) do not come into play in this argument. This argument relies on the owner’s assumption that his price rise will fix, or at least ameliorate, ToySMart financial problems, which do not (in this scenario) involve other stores.
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Re: If shoplifting at ToySMart continues at the current rate &nbs [#permalink] 11 Aug 2018, 05:24

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