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Manager
Joined: 02 Jun 2008
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09 Jun 2008, 20:58
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On Monday, Daisy’s Lemonade Stand sold lemonade at 20 cents per cup. The Lemon Shack sold lemonade at 30 cents per cup. At the end of the day, Daisy’s Lemonade Stand and the Lemon Shack reported identical revenues and identical profits.

The statements above best support which of the following assertions?

A) On Monday, Daisy’s Lemonade Stand sold fewer cups of lemonade than did the Lemon Shack.
B) The Lemon Shack sells higher quality lemonade than does Daisy’s Lemonade Stand.
C) On Monday, Daisy’s Lemonade Stand and the Lemon Shack incurred identical costs to run their businesses.
E) The Lemon Shack would not increase its revenues by lowering its prices.

Why couldn't the answer be D? If Daisy's lemonade is cheaper than Lemon Shack's and they both had similar revenues, then more people bought Daisys.

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Director
Joined: 10 Sep 2007
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09 Jun 2008, 21:11
Consumer might be preferring it for price not for the quality.

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Intern
Joined: 08 Jun 2008
Posts: 47

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09 Jun 2008, 21:14
Here the passage talks about identical profits along with identical revenue

Both can have identical profits only when their costs incurred are same

Hence the answer c) ... is that the OA ?

It cannot be D , cos the consumers buying from lemon shack obviously prefer that lemonade over daisies .. so we cant generalise for all the consumers ( I guess if they mentioned that the majority prefers daisies lemonade then c) would have sounded a bit more appropriate).... had the option c) not been there ... d) would have seemed the best fir answer

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Director
Joined: 14 Aug 2007
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09 Jun 2008, 21:32
lionheart187 wrote:
On Monday, Daisy’s Lemonade Stand sold lemonade at 20 cents per cup. The Lemon Shack sold lemonade at 30 cents per cup. At the end of the day, Daisy’s Lemonade Stand and the Lemon Shack reported identical revenues and identical profits.

The statements above best support which of the following assertions?

A) On Monday, Daisy’s Lemonade Stand sold fewer cups of lemonade than did the Lemon Shack.
B) The Lemon Shack sells higher quality lemonade than does Daisy’s Lemonade Stand.
C) On Monday, Daisy’s Lemonade Stand and the Lemon Shack incurred identical costs to run their businesses.
E) The Lemon Shack would not increase its revenues by lowering its prices.

Why couldn't the answer be D? If Daisy's lemonade is cheaper than Lemon Shack's and they both had similar revenues, then more people bought Daisys.

It should be C (though E too seems alright)
At the end of the day, Daisy’s Lemonade Stand and the Lemon Shack reported identical revenues and identical profits.

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Senior Manager
Joined: 29 Aug 2005
Posts: 272

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09 Jun 2008, 22:25
lionheart187 wrote:
On Monday, Daisy’s Lemonade Stand sold lemonade at 20 cents per cup. The Lemon Shack sold lemonade at 30 cents per cup. At the end of the day, Daisy’s Lemonade Stand and the Lemon Shack reported identical revenues and identical profits.

The statements above best support which of the following assertions?

A) On Monday, Daisy’s Lemonade Stand sold fewer cups of lemonade than did the Lemon Shack. (the CR stem does not point out anything like that - so this choice is irrelevant here)
B) The Lemon Shack sells higher quality lemonade than does Daisy’s Lemonade Stand. (the CR stem does not point out anything like that - so this choice is irrelevant here)
C) On Monday, Daisy’s Lemonade Stand and the Lemon Shack incurred identical costs to run their businesses. - correct answer choice
D) In general, lemonade consumers prefer the lemonade at Daisy’s Lemonade Stand to the Lemonade at the Lemon Shack. (again the CR stem does not point out anything like that - so we dont really know whether consumers actually prefer the lemonade at Daisy’s Lemonade Stand to the Lemonade at the Lemon Shack)
E) The Lemon Shack would not increase its revenues by lowering its prices. (there is nothing in the stem that supports this)

Why couldn't the answer be D? If Daisy's lemonade is cheaper than Lemon Shack's and they both had similar revenues, then more people bought Daisys.

IMO C is the answer for this one. i just got the answer by POE.

what is the OA for this one
_________________

The world is continuous, but the mind is discrete

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Manager
Joined: 12 May 2006
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09 Jun 2008, 22:39
My first choice is D but after rethinking i can consider C.

I am not sure if i will be able selected C on the day of the test.

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Manager
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10 Jun 2008, 06:07
OA is C

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Re: MGMAT CR   [#permalink] 10 Jun 2008, 06:07
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