GMAT Question of the Day - Daily to your Mailbox; hard ones only

 It is currently 15 Jan 2019, 16:26

### GMAT Club Daily Prep

#### Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

## Events & Promotions

###### Events & Promotions in January
PrevNext
SuMoTuWeThFrSa
303112345
6789101112
13141516171819
20212223242526
272829303112
Open Detailed Calendar
• ### \$450 Tuition Credit & Official CAT Packs FREE

January 15, 2019

January 15, 2019

10:00 PM PST

11:00 PM PST

EMPOWERgmat is giving away the complete Official GMAT Exam Pack collection worth \$100 with the 3 Month Pack (\$299)
• ### The winning strategy for a high GRE score

January 17, 2019

January 17, 2019

08:00 AM PST

09:00 AM PST

Learn the winning strategy for a high GRE score — what do people who reach a high score do differently? We're going to share insights, tips and strategies from data we've collected from over 50,000 students who used examPAL.

# In troubled economic times, there is a shift in business from mainstre

Author Message
TAGS:

### Hide Tags

Intern
Joined: 18 Aug 2014
Posts: 49
Location: India
GMAT 1: 740 Q49 V40
GPA: 3.11
In troubled economic times, there is a shift in business from mainstre  [#permalink]

### Show Tags

Updated on: 14 Mar 2017, 10:27
1
00:00

Difficulty:

25% (medium)

Question Stats:

84% (01:56) correct 16% (02:24) wrong based on 95 sessions

### HideShow timer Statistics

In troubled economic times, there is a shift in business from mainstream retail stores to discount retail stores as consumers aim to reduce their total monthly spending. For local discount stores, when unemployment rises or effective wages decline due to inflation or another cause, sales go up. By contrast, however, during periods of extreme economic hardship, business at discount stores stops improving and may even suffer.

Which of the following, if true, does most to explain the contrast described above?

A) During extreme economic hardship, businesses that are located near discount stores and which also cater to lower spending levels also suffer.

B) The lower overall levels of consumer spending are, the more discount stores will benefit.

C) When discount stores flourish, they may be able to hire additional staff and raise effective wages.

D) During extreme economic hardship, consumers may continue to reduce total spending even after they have shifted their purchases to the most economic outlets available.

E) Except during periods of extreme economic hardship, discount stores tend to thrive more in economies benefiting from a direct economic stimulus, which increases spending cash.

_________________

Today's actions are tomorrow's results

Originally posted by AARONRAMSEY on 12 Mar 2017, 20:02.
Last edited by Bunuel on 14 Mar 2017, 10:27, edited 1 time in total.
Renamed the topic.
SC Moderator
Joined: 13 Apr 2015
Posts: 1687
Location: India
Concentration: Strategy, General Management
GMAT 1: 200 Q1 V1
GPA: 4
WE: Analyst (Retail)
Re: In troubled economic times, there is a shift in business from mainstre  [#permalink]

### Show Tags

13 Mar 2017, 15:00

Argument: Discount stores are expected to do well but they do not
Missing Info: Discount stores also feel the heat of recession.

A) During extreme economic hardship, businesses that are located near discount stores and which also cater to lower spending levels also suffer. - Incorrect. Irrelevant.

B) The lower overall levels of consumer spending are, the more discount stores will benefit. - Incorrect. Opposite.

C) When discount stores flourish, they may be able to hire additional staff and raise effective wages. - Incorrect. Out of scope.

D) During extreme economic hardship, consumers may continue to reduce total spending even after they have shifted their purchases to the most economic outlets available. - Correct. Explains the reason for the under performance of discount stores during economic recession.

E) Except during periods of extreme economic hardship, discount stores tend to thrive more in economies benefiting from a direct economic stimulus, which increases spending cash. - Incorrect. Out of context. Talks about the period when there is no economic hardship.

Senior Manager
Status: You have to have the darkness for the dawn to come
Joined: 09 Nov 2012
Posts: 290
Daboo: Sonu
GMAT 1: 590 Q49 V20
GMAT 2: 730 Q50 V38
Re: In troubled economic times, there is a shift in business from mainstre  [#permalink]

### Show Tags

19 Mar 2017, 07:38
AARONRAMSEY wrote:
In troubled economic times, there is a shift in business from mainstream retail stores to discount retail stores as consumers aim to reduce their total monthly spending. For local discount stores, when unemployment rises or effective wages decline due to inflation or another cause, sales go up. By contrast, however, during periods of extreme economic hardship, business at discount stores stops improving and may even suffer.

Which of the following, if true, does most to explain the contrast described above?

A) During extreme economic hardship, businesses that are located near discount stores and which also cater to lower spending levels also suffer.

B) The lower overall levels of consumer spending are, the more discount stores will benefit.

C) When discount stores flourish, they may be able to hire additional staff and raise effective wages.

D) During extreme economic hardship, consumers may continue to reduce total spending even after they have shifted their purchases to the most economic outlets available.

E) Except during periods of extreme economic hardship, discount stores tend to thrive more in economies benefiting from a direct economic stimulus, which increases spending cash.

Here the prompt says during economic hardship discount stores flourishes but during extreme hardship discount stores suffer insted of flourishing.
we need to resolve this
if during extreme economic hardship people stops visiting discount stores then paradox will be resolved

Hence D is correct
_________________

You have to have the darkness for the dawn to come.

Give Kudos if you like my post

Re: In troubled economic times, there is a shift in business from mainstre &nbs [#permalink] 19 Mar 2017, 07:38
Display posts from previous: Sort by