Last August the XT chain of gasoline stations had a temporary sales

Hi!

I still think there is no right answer here.

When we are talking about boosting sales, we shouldnt care about how the rest of the market is improving sales. We should only care if in XT that promotion led to a sales increase, right? Even if the rest of gas stations had a 100% increase in sales, that doesnt mean that for XT the promotion didnt led to a sales increase.

For example, if each month of the year had a sales increase of 5% related to the same month last year, the 10% increase in August should be viewed as an increase attributed to the promotion....Am I wrong?

GMATNinja can you help me with this?

Thks!

The question asks us which answer choice would be "most helpful" in evaluating the argument. So, we don't need the correct one to pose a question that tells us without a doubt whether the promotion led to a sales increase. Instead, we just need to pick the answer choice that would be helpful to know.

The conclusion is that "the promotion was successful as a means of boosting sales." The evidence to support this conclusion is that "for the month of August, XT experienced a ten percent increase in gasoline sales as compared to sales in August the previous year."

To evaluate this argument, here's the question posed in (A):

Let's say that overall sales of gasoline were WAY UP this past August -- maybe there was a huge influx of visitors for a music festival, or maybe everyone suddenly decided to stockpile gasoline in preparation for an impending zombie apocalypse.

In this scenario, the 10% increase at XT has nothing to do with the promotion. Instead, there is some outside cause of increased sales in gasoline.

What if, on the other hand, sales in the area were the same last August when compared with sales the previous August? Then perhaps the promotion did lead to increased sales.

This is why knowing the answer to the question in (B) would be helpful in evaluating the argument. (B) is the correct answer.

Now, it's absolutely possible that the promotion WAS the cause of XT's success last August, even if other gas stations in the area did better than the previous August as well. Maybe XT would have been left in the dust if it didn't run the promotion. But that's ok, because we don't need the correct answer choice to prove that the argument is valid or invalid -- we just need it to help us make that determination.

I hope that helps!

VeritasKarishma - Red HIghlighted Part? Where in the passage it is mentioned?

I got it wrong. Since its a GMAT prep question, A has to be right. Still, I am unable to comprehend why C is incorrect ( In my understanding If a customer who buys 10 gallons of gasoline in 10 days, but now he is buying 10 gallons at once will not increase sales. Is it a flawed Logic?

Note the last sentence of the argument: " ... so evidently the promotion was successful as a means of boosting sales."

Promotion was carried out to boost sales i.e. to increase revenue.
Now whether you get revenue as many small units or as a few large units, does it matter? Overall revenue does not get impacted. So whether there were some customers who bought smaller quantities earlier but larger during promotion doesn't matter. In either case, it doesn't impact our revenue and hence it doesn't impact whether the plan worked or not.
Even if there are some customers who bought smaller quantities before and larger now, it doesn't matter.
And on the flip side, if there are no such customers, it again doesn't matter.
Hence (C) is not relevant.

I still don't understand this question.

(A) In the areas in which XT’s gasoline stations operate, how did total combined gasoline sales for all gasoline stations last August compare with sales for the previous August? <-- I thought the stimulus already answered this question: "For the month of August, XT experienced a ten percent increase in gasoline sales as compared to sales in August the previous year." We're comparing last August vs. the previous August both times. How does (A) give any new information?

I chose (D) because I thought, if XT has to pay other business to provide the car washes, it means their customers are being attracted by the promotion and actually buying ten gallons to get the car wash benefit. Where is my thinking wrong? Thank you.

Experts, I have a small question. Here, what does - total combined gasoline sales for all gasoline stations - mean?

What I interpreted was: let's say there are 4 stations - XT, A, B, C and their sales last Aug are - 100, 100, 100 and 100.
Now, even if just the sales of XT increases this Aug, with the new sales figure - 110, 100, 100, 100, total combined gasoline sales for all gasoline stations increases.

Before, total combined gasoline sales for all gasoline stations = 400
After, total combined gasoline sales for all gasoline stations = 410.

How does this help us to evaluate that this increase was/was not due to promotional effect? Am I interpreting "total combined gasoline sales for all gasoline stations" wrong? Please help. GMATNinja

(A) In the areas in which XT’s gasoline stations operate, how did total combined gasoline sales for all gasoline stations last August compare with sales for the previous August? The hypothesis in the question is that the offer boosted sales in August. This option provides a possible alternate reason for the August sales boost. Hence, this option seems viable. Let's look at the other options as well

(B) Was the money that XT earned from the increase in gasoline sales enough to offset the cost of providing free car washes during the promotion? This is irrelevant to the question because we aren't evaluating the economics of the offer. Rather we're evaluating the hypothesis that the offer boosted sales.

(C) Were there any customers who bought ten or more gallons at an XT gasoline station during the promotion who would have bought gasoline at the same station in lower quantities, but more frequently, if the promotion had not been in effect? This would again mean that the offer "worked".It doesn't provide any information in "evaluating" the argument.

(D) Did XT or any of its gasoline stations have to pay other businesses to provide the car washes that customers were offered in the promotion? Irrelevant to the question

(E) Are XT’s gasoline sales in August usually significantly higher than one twelfth of XT’s annual gasoline sales? There would always be some months whose sales numbers are significantly higher (what does this even imply?) than the average. Hence, this option provides no insight.

Regards

Arun Krishnan
GMAT with AK

The conclusion of the argument is that the promotion was successful as a means of boosting sales. In other words, the author concludes that the promotion was the reason for at least part of XT’s 10% increase in sales.

(A) introduces the possibility that gasoline sales increased for ALL gas stations in the area and NOT just for XT’s gas stations. This implies that perhaps market conditions, and not XT’s promotion, drove the increase in sales. For more on why (A) is the best answer choice, check out this post.

And here’s (D):


Whether XT paid other businesses to provide the car washes does not indicate whether customers were attracted by the promotion. It’s possible that XT paid its own employees for the car washes. And it’s also possible that XT paid other businesses to provide the car washes. But we still don’t know whether the promotion was the driving force behind the increase in sales. We would only know about how the car washes were provided. Eliminate (D).


The total combined gasoline sales for all gasoline stations would include sales at both XT and every other gas station. Nevertheless, this figure would still be helpful because we could compare it to the 10% increase in gasoline sales at XT gas stations. If the 10% increase at XT gas stations is greater than the percent increase for all gas stations, then the promotion likely accounts for the increase. If the increase at XT gas stations is equal to or less than the increase at all other gas stations, then the promotion is probably not behind the growth.

In your example, sales at XT increased by 10% and total combined sales for all gas stations increased only 2.5%. This means that the promotion probably drove greater growth at XT gas stations, so it was successful as a means of boosting sales. Therefore, (A) is the best answer choice.

I hope that helps!

Hi

Let me try to address your query with the same numbers that you have taken as an example.

Let's say:

Before, total combined gasoline sales for all gasoline stations = 400
After, total combined gasoline sales for all gasoline stations = 410

This tells us that the entire increase in sales of gasoline in these areas has come from XT. In other words, XT is alone in increasing its sales, implying that it has done something different. This gives strength to the conclusion.

On the other hand, let's say:

Before, total combined gasoline sales for all gasoline stations = 400
After, total combined gasoline sales for all gasoline stations = 440

This tells us that XT sales increased by 10%, and total sales also increased by 10%. Therefore, the increase in XT sales is more likely due to an increase in demand and not from its promotion campaign.

Hope this helps.

I totally understand why A is correct however in my review I'm trying to understand why C is definitely wrong. Let's say I apply the variance test to C:
1) Yes - there were customers who bought 10+ gallons who would have otherwise bought gasoline in lower quantities but more frequently. This means customers would have bought that amount of gasoline regardless of promotion - Weakens the argument

2) No - no customers who bought 10+ gallons would have otherwise bought gasoline in lower quantities but more frequently. This means that the customers who bought 10+ gallons wouldn't have bought that much gasoline in the first place - Strengthens the argument

Based on that interpretation, C sounds like a good choice

I had the exact same reasoning as this user. Can someone help to explain what is wrong in our reasoning please ? Thank you in advance !

GMATNinja

This issue is discussed as length throughout this thread -- please see all of @VeritasKarishma's posts and let us know if that doesn't clear things up.

(C) Were there any customers who bought ten or more gallons at an XT gasoline station during the promotion who would have bought gasoline at the same station in lower quantities, but more frequently, if the promotion had not been in effect?


This one is close. What I think we need to know though is whether the promotion attracted customers that usually wont buy gasoline at XT. Information about the customers that already buy their gasoline at XT and would have still bought it there does not shed any new light on the impact of the promotion.

i cant understand why such lengthy explaination is provided.
the explaination is quite easy.

the answer c is talking the fuel owner will buy frequently.
wheather it buy in a a single take or it buy frequently in the same month(as it is not mention same month or differnt month).the total sale will come same,and there will be no effect on sales

Hi experts avigutman IanStewart

I ran into this question in my practice exam, spent about three minutes but still got it incorrectly. I've checked all the previous posts in this thread, but still have a few doubts for the option (C). Could you share some of your thoughts when you have time?

To be honest, I have no much confidence in the evaluation-type questions, as I feel that the workload is twice that of a strengthen/weaken type question, and can eat up my time easily. Some tutors have shared their approach online. They said that since almost all answer choices in the evaluation-type question begin with "whether" or are "yes or no" questions, test takers can change the option, an interrogative sentence, into an affirmative sentence by assuming the answer to the question is "yes," and check whether the new sentence strengthens or weakens the argument. If it can, there is no need to check another version and the option would be the correct answer.

I am not to criticize this approach (I think it is invented to help people save time), but as you may imagine, I was kind of lost when I saw the option (A), which is a question with "how" and cannot be really converted into an affirmative sentence. Moreover, I misinterpreted (A) as talking about the combined gasoline sales for all XT's gasoline stations, rather than for all gasoline stations (XT and non XT), and thus I turned away.

Instead, I chose (C), as I felt that it could somehow answer the question "Did the promotion help boost the sales?" My thought was that because these customers who bought ten or more gallons last August would have bought less gas (each time) but bought gas more frequently if there had been no free car wash, it is possible that the combined amount of gas these customers bought last August were the same from a year earlier. Then, we can infer that the promotion is not an effective means, and there must be another reason for the 10 percent increase in sales.



Is my original train of thoughts wrong because I did not catch the very word "any" in the option (C)? The option (C) does not talk about the customers in general, but talks specifically whether there was at least one such a customer.

The "yes" answer to (C): Yes, there is at least one such a customer. This customer bought ten or more gallons at an XT gasoline station during the promotion, and he or she would have bought gasoline at the same station in lower quantities, but more frequently, if there had been no free car wash.
=>Okay, maybe this customer in fact bought the same amount of gas as he or she did a year earlier. But how about other customers? We do not know whether they bought more gas because of free car wash. Hence, we cannot strengthen or weaken the argument that the promotion helped boost the sales.

The "no" answer to (C): No, there was not such customer.
=> The "no" version just tells us that no one would have bought less gas each time but bought more frequently if there had been no free car wash. And we cannot assume other things. How much gas did these customers buy? We have no idea. Without the promotion, they might have bought less gas in total (for example, 8 gallons once) or they bought the same amount of gas (for example, 10 gallons once). Hence, we are not clear whether the customers bought more gas last August because of the promotion. We cannot strengthen or weaken the argument.

(My thought was similar to the following, but now I see that we cannot ignore the word "ANY" and assume about the customers lightly.)



Besides, I hope to confirm the logic about the correct option (A).

I think that even if we know the growth rate of the combined gas sales of all gasoline stations in the areas where XT operates, we cannot be 100 percent certain whether the promotions is effective (unless the question stimulus tells us all other things being equal, but they never do so). For example, even if the combined sales grew 5 percent annually, less than XT's sales did, there could be an explanation other than free car wash for the higher growth in XT's sales, such as extended service hour. Even if the combined sales grew 10 percent, the same as XT's sales did, it does not necessarily mean that the promotion was not effective--maybe all gasoline companies launched new campaign last August (as all cosmetics companies tend to do something in November), and if XT had not offered the free car wash, it would have seen a revenue drop.

But the point is that we do not need to be 100 percent certain whether the promotion is effective, do we? If evaluation is really just a combination of strengthen and weaken type question, the information in the correct option does not need to prove or disprove the argument, right?

Thank you so much!
Your explanations would help me know more clearly about my task in the evaluation type questions.
Thank you for helping me learn.

Yes, the word *any* definitely makes this answer a lot less useful, but I would eliminate this answer regardless, thanks to the very specific nature of the claim made in the argument:

You touch on this point yourself, GraceSCKao, here:



Right. For this reason, it actually is useful to assume *all other things being equal* in this question type.

I thought (A) was several steps away from being helpful in evaluating the argument. Specifically i thought if one was to pick (A) -- the test taker has to make several assumptions on our own to pick (A)

If you review the above chart (numbers in the red) - Total sales for all the gas stations are the same BUT sales for XT did increase by 10 %.

So did the 10 % increase in XT's sales come because of promotions ?

We can't say from the above chart

So what does the above prove ? Some stations did well and some station DID NOT DO well (in terms of sales between last august and last to last august)

Thoughts ?

Remember that the prompt asks which questions, if answered, would be most helpful to evaluate the argument, not to prove/disprove the argument. If we know that total sales increased comparably at gas stations in the same area as XT, then there's little reason to believe that the promotion was behind the boost in sales because the promotion was only at XT's gas stations. Maybe people in XT's area were traveling more this year than last year, so sales went up for everyone.

But if we know that XT's sales increased while sales remained constant for everyone else, then we have good reason to believe that something XT is doing is driving the increase. That doesn't prove that the promotion drove the increase, but it does strengthen the idea and help in our evaluation. Even in the example that you highlighted, XT's sales increased by a greater percentage than everyone else. That doesn't necessarily mean that the promotion drove the growth, but it does mean that XT must be doing something better than its competitors. And we have good reason to believe that could be the promotion.

For further discussion on (A), it may be helpful to check out this post.

I hope that helps!