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In an effort to boost sales during the summer months, which are typica

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In an effort to boost sales during the summer months, which are typica  [#permalink]

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01 Apr 2020, 00:09
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In an effort to boost sales during the summer months, which are typically the best for soft-drink sales Foamy Soda lowered its prices. In spite of this, however, the sales of Foamy Soda dropped during the summer months.

Each of the following, if true, contributes to reconciling the apparent discrepancy indicated above EXCEPT:

(A) The soft-drink industry as a whole experienced depressed sales during the summer months.

(B) Foamy Soda’s competitors lowered their prices even more drastically during the summer months.

(C) Because of an increase in the price of sweeteners the production costs of Foamy Soda rose during the summer months.

(D) A strike at Foamy Soda’s main plant forced production cutbacks that resulted in many stores not receiving their normal shipments during the summer months.

(E) The weather during the summer months was unseasonably cool, decreasing the demand for soft drinks.

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Re: In an effort to boost sales during the summer months, which are typica  [#permalink]

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01 Apr 2020, 01:44
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I would say the right answer is C.

We have that Foamy Soda lowered their prices to boost soda sales in summer (apparently the best season) but seems it did not work and their sales instead dropped.

But the question is about what does not relate to the SALES reduction.

A. would give an explanation on why the SALES drop in summer for Foamy (because all industry went down)
B. would explain specifically why Foamy's SALES went down vs competition (they lowered their prices even more)
C. would explain why REVENUES went down (new information, does not relate to the sales), that could have impacted production but is not stated, so this one it is.
D. would explain why SALES drop (supply did not reach the markets)
E. would explain why SALES drop (demand was lower)
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Re: In an effort to boost sales during the summer months, which are typica  [#permalink]

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01 Apr 2020, 02:24
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In an effort to boost sales during the summer months, which are typically the best for soft-drink sales Foamy Soda lowered its prices. In spite of this, however, the sales of Foamy Soda dropped during the summer months.

Each of the following, if true, contributes to reconciling the apparent discrepancy indicated above EXCEPT:

We need to find option that does not explains the reason for lower sales in spite of lower prices.

(A) The soft-drink industry as a whole experienced depressed sales during the summer months. :-this says whole industry is experiencing down trends, this explains why sales is dipping, incorrect option

(B) Foamy Soda’s competitors lowered their prices even more drastically during the summer months. :-Competitors have decreased their price as well in response, it explains why sales are dipping, incorrect

(C) Because of an increase in the price of sweeteners the production costs of Foamy Soda rose during the summer months. this does not explains why sales are dipping, production cost has gone up but low soda prices would have compensated this .

(D) A strike at Foamy Soda’s main plant forced production cutbacks that resulted in many stores not receiving their normal shipments during the summer months. :- stocks are not available, sales figures have gone down.

(E) The weather during the summer months was unseasonably cool, decreasing the demand for soft drinks.:- cold weather resulted in lesser demand explains why sales are dipping
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Re: In an effort to boost sales during the summer months, which are typica  [#permalink]

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01 Apr 2020, 03:04
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(A) The soft-drink industry as a whole experienced depressed sales during the summer months. --> Explains the decrease

(B) Foamy Soda’s competitors lowered their prices even more drastically during the summer months. --> Due to competition, sales have gone down --> Explains

(C) Because of an increase in the price of sweeteners the production costs of Foamy Soda rose during the summer months. --> Does not explain (Production cost is irrelevant to sales)

(D) A strike at Foamy Soda’s main plant forced production cutbacks that resulted in many stores not receiving their normal shipments during the summer months. --> Explains (Less sales due as shipments decreased)

(E) The weather during the summer months was unseasonably cool, decreasing the demand for soft drinks. --> Explains (Since sales are best only in summers, weather has played role in decrease of sales)

Option C
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Re: In an effort to boost sales during the summer months, which are typica  [#permalink]

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Updated on: 01 Apr 2020, 04:58
1
In an effort to boost sales during the summer months, which are typically the best for soft-drink sales Foamy Soda lowered its prices. In spite of this, however, the sales of Foamy Soda dropped during the summer months.

Each of the following, if true, contributes to reconciling the apparent discrepancy indicated above EXCEPT:

Note: As this is an except question, we will find all the options that contributes to the decrease in sales and the one remaining will be Our Answer.

Conclusion: The sales of Foamy Soda dropped during the summer months.
Premise: In an effort to boost sales during the summer months, which are typically the best for soft-drink sales Foamy Soda lowered its prices

Analysis: As we can see from the above conclusion and premise, there is some discrepancy as to why the sales did not increase in summer even though the prices were decreased.

Lets find out all the options which will point to those discrepancy:

A) The soft-drink industry as a whole experienced depressed sales during the summer months.{If the whole industry is facing trouble than that same trouble is faced by the Foamy Soda company, which in turn decreases sales of Foamy Soda company}

(B) Foamy Soda’s competitors lowered their prices even more drastically during the summer months.{ Obviously if the prices of competitors are more reduced, then people will buy from competitors, which in turn decreases sales of Foamy Soda company}

(C) Because of an increase in the price of sweeteners the production costs of Foamy Soda rose during the summer months.{This does not tell anything about sales.If the price of sweeteners has increased,then that would effect the whole industry. However this may/may not have an impact on sales. Lets keep it.}

(D) A strike at Foamy Soda’s main plant forced production cutbacks that resulted in many stores not receiving their normal shipments during the summer months.
{ This clearly indicates decrease in sales as the distribution is hampered}
(E) The weather during the summer months was unseasonably cool, decreasing the demand for soft drinks.
{If the demand is decreased then people drink fewer sodas,hampering the soda business of poor Foamy Soda }

We are left with C.
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Originally posted by Krishh9119 on 01 Apr 2020, 03:05.
Last edited by Krishh9119 on 01 Apr 2020, 04:58, edited 1 time in total.
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Re: In an effort to boost sales during the summer months, which are typica  [#permalink]

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01 Apr 2020, 04:06
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Quote:
In an effort to boost sales during the summer months, which are typically the best for soft-drink sales Foamy Soda lowered its prices. In spite of this, however, the sales of Foamy Soda dropped during the summer months.

Each of the following, if true, contributes to reconciling the apparent discrepancy indicated above EXCEPT:

(A) The soft-drink industry as a whole experienced depressed sales during the summer months.

(B) Foamy Soda’s competitors lowered their prices even more drastically during the summer months.

(C) Because of an increase in the price of sweeteners the production costs of Foamy Soda rose during the summer months.

(D) A strike at Foamy Soda’s main plant forced production cutbacks that resulted in many stores not receiving their normal shipments during the summer months.

(E) The weather during the summer months was unseasonably cool, decreasing the demand for soft drinks.

argument
= foamy reduce price to boost sales in summer
= summer usually best sales months
= sales dropped

which doesnt explain the above?

Ans (C) even if costs increased, the price per soda was still reduced - thus this doesnt explain y sales fell.
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Re: In an effort to boost sales during the summer months, which are typica  [#permalink]

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01 Apr 2020, 05:25
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I will go with answer C,

Option A and B are easy to eliminate, as it is impacting directly to the sales.
Option D: Because of the strike, No, of products decreased as a result, stores were not able to sell them further.
Option E: Season change, implying people not preferring the drink.

Option C: talks about the Rise in the Prices of Foamy Soda, so not directly implying the sales impact. In order to make this valid we need to go a step ahead.
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Re: In an effort to boost sales during the summer months, which are typica  [#permalink]

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01 Apr 2020, 05:50
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All options except C is providing reasons for decreased sales inspite of price reduction in summer months. C talks about production cost but not about how sales reduced even after massive price cut.

In my opinion C is better answer among given choices.
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Re: In an effort to boost sales during the summer months, which are typica  [#permalink]

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01 Apr 2020, 19:37
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Here the conclusion is that the sales of Foamy Soda dropped during the summer months.

Options given support this conclusion except one. Lets find that one choice

(A) The soft-drink industry as a whole experienced depressed sales during the summer months.

Okay, so this points that sales of Foamy Soda could have dropped during the summer months. It supports our conclusion. Hence Incorrect

(B) Foamy Soda’s competitors lowered their prices even more drastically during the summer months.

Okay, so this also points that sales of Foamy Soda could have dropped during the summer months as competitors were selling more. It supports our conclusion. Hence Incorrect

(C) Because of an increase in the price of sweeteners the production costs of Foamy Soda rose during the summer months.

This one does not actually help in explaining why the sales could have gone down. Whatever the company would be producing, they will check the sales on that basis only. Does not clearly explain why sales could be hampered because of this. Hence may be correct

(D) A strike at Foamy Soda’s main plant forced production cutbacks that resulted in many stores not receiving their normal shipments during the summer months.

Okay, so if stores did not receive the items of the sales, then that will cause an issue and will tell us why after producing 'x' units, company was not able to make sale.Hence Incorrect

(E) The weather during the summer months was unseasonably cool, decreasing the demand for soft drinks.

This clearly explains why sales could have decreased. Hence Incorrect

So IMO, only C remains and is the correct answer.

Waiting for the OA
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Re: In an effort to boost sales during the summer months, which are typica  [#permalink]

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01 Apr 2020, 22:59
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In an effort to boost sales during the summer months, which are typically the best for soft-drink sales Foamy Soda lowered its prices. In spite of this, however, the sales of Foamy Soda dropped during the summer months.

Each of the following, if true, contributes to reconciling the apparent discrepancy indicated above EXCEPT:

Stimulus: In an effort to increase the sales in summer months soft drink sales company foamy soda lowered its price still the sales dropped in spite being summer month.

we have to find that does not support the low sales

(A) The soft-drink industry as a whole experienced depressed sales during the summer months.overall all soft drink company sales were low so even foamy companies sales was low this agrees with the stimulus

(B) Foamy Soda’s competitors lowered their prices even more drastically during the summer months. as the competitors prices were lower than Foamy soda's their sales feel supports the stimuls

(C) Because of an increase in the price of sweeteners the production costs of Foamy Soda rose during the summer months. As the production cost rose during the summer months. This does not reconcile with the stimulus. IMO C

(D) A strike at Foamy Soda’s main plant forced production cutbacks that resulted in many stores not receiving their normal shipments during the summer months. As there was less production less sales reconciles with the stimulus

(E) The weather during the summer months was unseasonably cool, decreasing the demand for soft drinks.
The weather was cool and so demand for soft drinks decreased this reconciles with stimulus

IMO C
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Re: In an effort to boost sales during the summer months, which are typica  [#permalink]

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01 Apr 2020, 23:36
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Ans: C

(C) Because of an increase in the price of sweeteners the production costs of Foamy Soda rose during the summer months.

The argument says that foamy decreased the price and option C doesn't provide any explanation to resolve the paradox.
Re: In an effort to boost sales during the summer months, which are typica   [#permalink] 01 Apr 2020, 23:36