NowNews, although still the most popular magazine covering cultural

Question

Which of the following most logically completes the argument below?

NowNews , although still the most popular magazine covering cultural events in Kalopolis, has recently suffered a significant drop in advertising revenue because of falling circulation. Many readers have begun buying a competing magazine that, at 50 cents per copy, costs less than  NowNews  at $1.50 per copy. In order to boost circulation and thus increase advertising revenue,  NowNews 's publisher has proposed making it available at no charge, but this proposal has a serious drawback, since _______.

(A) Those Kalopolis residents with the greatest interest in cultural events are regular readers of both magazines.

(B) One reason  NowNews 's circulation fell was that its competitor's reporting on cultural events was superior.

(C) The newsstands and stores that currently sell  NowNews  will no longer carry it if it is being given away for free.

(D) At present, 10 percent of the total number of copies of each issue of  NowNews  are distributed free to students on college campuses in the Kalopolis area.

(E)  NowNews 's competitor would begin to lose large amounts of money if it were forced to lower its cover price.

NowNews Magazine  
 
   Step 1: Identify the Question

This is a fill in the blank question. The word since before the blank indicates that this is a  Strengthen the Argument  question.

Step 2: Deconstruct the Argument

Drop in circ à Ad rev down

Comp $0.50 vs NN $1.50

Plan: NN=Free

Circ up à Ad rev up

Ó Plan is flawed

Step 3: Pause and State the Goal

On Strengthen questions, the goal is to find a piece of information that would make the conclusion at least a little more likely to be valid.

In this case, note that you are not looking to strengthen the publisher’s plan. Rather, the author of the argument believes that the   publisher’s plan is flawed  . Your task is to find a reason that supports this claim.

Step 4: Work from Wrong to Right

(A) The fact that some people read both magazines does not provide additional information; the argument already states that total readership for NowNews has dropped.

(B) Even if there are reasons besides price that readership of NowNews fell (such as poorer reporting quality), the publisher’s plan of cutting price to increase circulation could still be effective.

(C) CORRECT . This information seriously calls into question whether the publisher’s plan could work. The plan assumes that giving the magazine away for free will increase circulation. If current distribution channels are no longer available, it will be much more difficult to increase circulation—so this choice strengthens the author’s claim that the plan is flawed.

(D) The fact that some copies of NowNews are currently given away for free does not help to determine whether giving away all copies for free will increase circulation.

(E) The conclusion of the argument is only about advertising revenue for NowNews, so the effects of a similar plan on a competitor are not relevant.

EMPOWERgmatVerbal · Accepted Answer

Which of the following most logically completes the argument below?

NowNews, although still the most popular magazine covering cultural events in Kalopolis, has recently suffered a significant drop in advertising revenue because of falling circulation. Many readers have begun buying a competing magazine that, at 50 cents per copy, costs less than NowNews at $1.50 per copy. In order to boost circulation and thus increase advertising revenue, NowNews's publisher has proposed making it available at no charge, but this proposal has a serious drawback, since _______.

(A) Those Kalopolis residents with the greatest interest in cultural events are regular readers of both magazines.
(B) One reason NowNews's circulation fell was that its competitor's reporting on cultural events was superior. 
(C) The newsstands and stores that currently sell NowNews will no longer carry it if it is being given away for free.
(D) At present, 10 percent of the total number of copies of each issue of NowNews are distributed free to students on college campuses in the Kalopolis area.
(E) NowNews's competitor would begin to lose large amounts of money if it were forced to lower its cover price.

Type  : Inference Fill-In-The-Blank
  Boil It Down  : ___ -> Making NowNews free has major drawback
  Missing Information  : A major drawback to making the publication free. Something that will likely negatively impact circulation.
  Goal  :  Find the option that offers a drawback to the proposal to make NowNews free 
  Analysis  : Inference Fill-In-The-Blanks are part of the Inference question family because the context in which the blank occurs forces a specific objective for the blank to satisfy. We can infer what type of information must go in the blank. Here, the context FORCES the information in the blank to be information that would show a substantial flaw in the plan to make NowNews free.

A)  This option does not present a substantial flaw in two critical aspects: 1) We don’t know how significant a group those with the most interest in cultural events is. This group could be rather small for all we know, and thus not important. 2) Even if this particular group reads both magazines anyway, it’s not clear why making the magazine free would have a serious drawback.

B)  If anything, this option might provide a factor that could help the plan succeed. If NowNews’ competitor has superior content, then NowNews might need a different method to compete, such as a lower price, or even free circulation.

C)     KABOOM! If NowNews were to lose access to the newsstands and stores that currently sell the magazine, then this option exposes an aspect of the plan that could prove devastating for circulation.

D)  If 10% of NowNews’ current circulation is already free, that leaves another 90% that could also be made free, so it’s not like the 10% that’s already free disrupts the opportunities that might come from making the entire magazine free.

E)  A total 180. This option actually provides a major benefit from the proposal to make NowNews free if its major competitor could lose large amounts of money if it were forced to lower its price (to compete with NowNews).

GMATNinja · Answer

(B) is tempting. If the other magazine features superior reporting, maybe people will still buy the competing magazine even if NowNews is free?

Notice that choice (B) says " One  reason NowNews's circulation fell..." If, instead, choice (B) said, "The ONLY reason NowNews's circulation fell...", then (B) would definitely pose a serious drawback.

But we are also told that there is a price difference. Perhaps reporting quality is a factor, but maybe customers care more about the price than the reporting quality. Choice (B) certainly works against the plan, but it doesn't necessarily represent a serious drawback or imply that the plan will fail.

Choice (C), on the other hand, definitely represents a serious drawback, so (C) is a better answer.

I hope that helps!

silicon · Answer

I will go with C
The magazine lost its circulation, which further costs it as a decrease in revenue from advertisement. Reason is given that competitor magazine is low cost. 
To regain the market the magazine company management decided to distribute the magazine for free, assuming that advertisement offered to it would compensate the costs. Now we have to find the case in which the plan would not reach the goal.
Lets prethink- It may possible that the retailers of the magazine would not be interested in further selling the magazine and it will Puncher the marketing network of the company leading to the failure of the plan.

regards
Silicon

sd.1223 · Answer

Please explain why option B is wrong.
It very clearly tells us that it is not the price which lead to the decline in circulation but the content. So no matter how much price you decrease, People will still buy competitor's magazine for it has better content.

So the drawback is that it is targeting wrong area.

AryamaDuttaSaikia · Answer

The plan to combat the situation rests on price reduction of the magazine. Our job is to find out why the present plan will not work. Now "B" identifies an altogether different reason but does not highlight why the present plan will backfire. Hence "B" cannot be a possible answer.

EMPOWERgmatVerbal · Answer

Hi sd.1223,

For reference, here's B again:
 (B)  One reason NowNews's circulation fell was that its competitor's reporting on cultural events was superior. 
I understand your question. You're saying that B is pointing to a drawback in the plan to drop prices because B explains that inferior content led to the drop in circulation. Here's the scoop though: B merely points to a drawback of the current situation, but we can't logically state if/when NowNews became free that inferior content couldn't be offset. Remember the question states: Which of the following  most logically completes the argument  below? We just don't know that inferior content is a drawback in the free pricing model were enacted.

Compare that to option C:
 (C)  The newsstands and stores that currently sell NowNews will no longer carry it if it is being given away for free.

Wow, that's a HUGE drawback. This option basically tells us that if NowNews became free, it would lose distribution at the newsstands and stores where it's currently sold. Even if it's free, if its distribution network were gutted, how would that impact the plan to boost circulation? Calling C a drawback is almost rendered an understatement. Therefore, C is definitely the option  that MOST logically completes the argument .

adkikani · Answer

Hi  GMATNinjaTwo   GMATNinja

Can you please help to eliminate option B?

My understanding:

NowNews is still the most popular magazine covering cultural events in Kalopolis
But it has recently suffered a significant drop in advertising revenue because of falling circulation.
 Reason for above:
Many readers have begun buying a competing magazine that is 0.5 cents cheaper than NoNews.
So what do NoNews publishers plan to do to increase advertising revenue which is related to higher circulation:
 They plan to make it available at no charge.

Now, this proposal has a serious drawback, (why?) The ans to why is OA, ie why will the plan fail?

B says one of reasons for people to buy competitor reporting is that later has better content, so even if NoNows publishers make magazine free, even then people will not but it.

siddhantmat09 · Answer

I believe most of the explanations above with answer "C" are making an assumption that if the MRP is set to 0 for the end consumers then the newspaper stands/stores will not be paid by the company/supply chain. It is not explicitly mentioned anywhere about the source of income for such stores and whether it is completely margin dependant. It could be for this plan company are paying stores to keep it. In such scenario, the newspaper stands will keep it and the demand would also increase drastically. Hence i do not believe that stocking the product should be directly correlated to MRP.

However since we also don't know about why end consumers are shifting, quality content is as good as a reason pricing is. And hence if content is the issue, decreasing the price would not work at all.

Unable to understand. Please guide. TIA.

However since we also don't know about why end consumers are shifting, quality content is as good as a reason pricing is. And hence if content is the issue, decreasing the price would not work at all.

Unable to understand. Please guide. TIA.

RohitSaluja · Answer

I was also torn between B and C, but in the end went with C, as the argument only wants to increase its circulation through which advertisement revenue would increase. C states that no one would keep the magazine if it is provided for free, which impacts the circulation, so it seemed a better fit than B.

ChiranjeevSingh · Answer

If I changed one word in option B, it'd become correct. The following version is correct:

The  reason  NowNews 's circulation fell was that its competitor's reporting on cultural events was superior.

The reason the above version is correct is that it now says competitor's superior reporting is THE reason (which means the only reason) why NowNews's circulation fell. By saying so, this changed option rules out the price of the magazine as a reason for falling circulation. In such a case, it seems that we can't boost circulation by lowering the price.

However, the original option B has no impact because it says "ONE" reason for the fall in circulation. Even if there are other reasons for the fall, if we fix one reason (price), the circulation should go up. Thus, the argument makes sense in the face of option B.

VP1030 · Answer

Option C: the newsstands and stores that currently sell NowNews will no longer carry it if it is being given away for free.

Why are we assuming that there are no other stores where NowNews magazine can be sold?

MartyTargetTestPrep · Answer

Hi VP1030.

The wording of "THE newsstands and stores that currently sell NowNews" communicates that the newsstands and stores mentioned are ALL the newsstands and stores that currently sell NowNews.

What fills the blank has to describe "a serious drawback" of the proposal.

The fact that all the newsstands and stores that currently sell NowNews will no longer carry it if the proposal is implemented is a serious drawback to the proposal, even there are some ther stores that would carry NowNews. After all, even if there are some stores that would carry it, the loss of relationships with all the retailer that sell NowNews currently would almost certainly be detrimental to the circulation of NowNews.

agrasan · Answer

Summary: 
1. The most popular magazine  NowNews  which covers cultural events in Kalopolis, has recently suffered a significant drop in advertising revenue  because of falling circulation 
2. Many readers have begun buying a competing magazine at 50 cents per copy, costs less than NowNews at $1.50 per copy
3. NowNews's publishers plans to sell at $0 --> Boost circulation --> Increase in advertising revenue

What the question has asked us: 
We have to find a reason why the proposal has a serious drawback. In other words, we have to find a Weakener.

(A) Those Kalopolis residents with the greatest interest in cultural events are regular readers of both magazines.
 Doesn't impact , making the magazine available at $0 can still boost circulation/increase revenues from new readers.

(B) One reason NowNews's circulation fell was that its competitor's reporting on cultural events was superior.
 Doesn't impact , this option provides us a reason why its circulation fell rather than providing us a reason why the proposal has a serious drawback.

(C) The newsstands and stores that currently sell NowNews will no longer carry it if it is being given away for free.
 Weakener , it explains why the proposal might not work as the places which currently sell NowNews will no longer include them once the price is $0.

(D) At present, 10 percent of the total number of copies of each issue of NowNews are distributed free to students on college campuses in the Kalopolis area.
 Doesn't impact , this option increases the confidence that the proposal can work because currently, 10% of copies are sold free to college campuses so it doesn't seem likely that they will not accept more free copies.

(E) NowNews's competitor would begin to lose large amounts of money if it were forced to lower its cover price.
 Doesn't impact , what will happen with competitor doesn't help us to understand why the proposal will have a serious drawback for NowNews.

rushimehta · Answer

Hi, GMATNinjaTwo GMATNinja ChiranjeevSingh

(B')The reason NowNews's circulation fell was that its competitor's reporting on cultural events was superior.

Based on your explanations, I do understood the logic which is applied here.

So, when we know that there is only 1 reason for a particular effect. Then there is a high chance that the given plan won't work, when we aren't tackling that cause (in this case the quality of reporting), we are trying to resolve the effect by achieving something else. (in this case making magazine free of cost)

I had below queries, let's assume we are provided option B' instead of B, and C option stays as it is -

To resolve an effect we can - either

Tackle the only cause - In this case, by improving the reporting quality... we are tackling the cause... and the effect will be resolved.
Implement something else, which ensures that the "importance of the cause" is decreased. For e.g. - In this case, even if the only cause was that the reporting quality being superior... if we make the magazines free, the quality might not matter any more! ... (which is usually the case in real life as well)

So, based on the above explanation is my below logic valid ?

If we have a cause and effect scenario - we can remove the effect, by either tackling the cause (in this case the quality), or also by doing something else (in this case making it free) which might then reduce/remove the effect.

By tackling the cause - we can be sure that the effect won't be there

By making a different plan - we can't be sure, but it may or may not work.

Also, if both the options B' and C are present - what will be the correct answer ?

... (which is usually the case in real life as well) So, based on the above explanation is my below logic valid ? If we have a cause and effect scenario - we can remove the effect, by either tackling the cause (in this case the quality), or also by doing something else (in this case making it free) which might then reduce/remove the effect. By tackling the cause - we can be sure that the effect won't be there By making a different plan - we can't be sure, but it may or may not work. Also, if both the options B' and C are present - what will be the correct answer ?

GMATNinja · Answer

As we said in the  quoted post , "If, instead, choice (B) said, 'The ONLY reason NowNews's circulation fell...', then (B) would definitely pose a serious drawback." That would make the question unanswerable, since both (B) and (C) would represent serious drawbacks.

The details of these questions are carefully crafted and edited, and there's really no reason to worry about alternative versions of the answer choices. The questions are hard enough on their own, so don't waste your time and energy doing something that you'll never have to do on test day: write your own answer choices!

NowNews, although still the most popular magazine covering cultural

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