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# Over an eleven-month period, during which national retail co

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Re: Over an eleven-month period, during which national retail co [#permalink]

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04 May 2016, 01:40
aswaniwait4u wrote:
AbhayPrasanna wrote:
11 month period. National sales is 400,000 units per month.
For the FCS chain, sales rose 200%, increasing its market share to 7%.

After regulation X:
FCS market share down to 4% BUT monthly sales volume remained the same as it was at the end of the 11 month period.

Which of the following CANNOT be true?

A. This cannot be true. Consider this: At the end of 11 month period, FCS had sales of 700, which was 7% of the entire market sales of 10,000. In ensuing months, FCS still sold 700, but this represents only 4% of the new market (=17,500), which must have obviously increased. If all other retailers experienced a DROP in the sales, how can the market increase, and thus the same amount of sales of FCS account for a lesser percentage of the market?!

I disagree with the OA, and am almost certain this is the answer.

B. This could be true, this is the 4 month period before regulation X, so there could have been fluctuations in that time, since we only know the net results of that 11 month period.

C. This could be true, and explains why the the other retailers experienced an increase in sales, and thus increasing the market relative to FCS's constant sales.

D. Other market force changes caused the market share decline - not some advantage that other people had over FCS. This is perfectly possible. What if regulation X caused some other changes in the market that explains FCS's constant sales but reduced market share? What if regulation X has nothing to do with what happened - perhaps some other event caused it.

E. This is perfectly possible and actually explains the increase in the market.

Pick A.

Please give Source and Original explanation if possible.

I can understand your point. However, your logic to deduct the answer A is not correct. There is no evidence or indication in the question that will suggest a decrease in sales of other companies. The reverse may be true- For instance, because of the new regulation the sales of the other companies might have increased!. Hence, A cannot be the answer.
One needs to look for an answer that the argument is inferring/supporting unambiguously. Option D acknowledges that the regulation did not provide the other companies an unprecedented advantage rather other factors such as tax period or safety concerns might have made the sales to remain constant. There is no ambiguity or paradox in this choice, thus the answer.

Hi. The question says that the share of Friendly reduced, however the absolute figure of its sales remained the same. That would simply imply that the total sales increased. If the sales of all other retailers decreased, there is no way the total sales could have increased. Hence, the statement 'A' cannot be true in case.

The question asks us to find the statement that can never be true. IMO, it should unambiguously be A.
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Re: Over an eleven-month period, during which national retail co [#permalink]

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04 May 2016, 04:34
Ankit73 wrote:
aswaniwait4u wrote:
AbhayPrasanna wrote:
11 month period. National sales is 400,000 units per month.
For the FCS chain, sales rose 200%, increasing its market share to 7%.

After regulation X:
FCS market share down to 4% BUT monthly sales volume remained the same as it was at the end of the 11 month period.

Which of the following CANNOT be true?

A. This cannot be true. Consider this: At the end of 11 month period, FCS had sales of 700, which was 7% of the entire market sales of 10,000. In ensuing months, FCS still sold 700, but this represents only 4% of the new market (=17,500), which must have obviously increased. If all other retailers experienced a DROP in the sales, how can the market increase, and thus the same amount of sales of FCS account for a lesser percentage of the market?!

I disagree with the OA, and am almost certain this is the answer.

B. This could be true, this is the 4 month period before regulation X, so there could have been fluctuations in that time, since we only know the net results of that 11 month period.

C. This could be true, and explains why the the other retailers experienced an increase in sales, and thus increasing the market relative to FCS's constant sales.

D. Other market force changes caused the market share decline - not some advantage that other people had over FCS. This is perfectly possible. What if regulation X caused some other changes in the market that explains FCS's constant sales but reduced market share? What if regulation X has nothing to do with what happened - perhaps some other event caused it.

E. This is perfectly possible and actually explains the increase in the market.

Pick A.

Please give Source and Original explanation if possible.

I can understand your point. However, your logic to deduct the answer A is not correct. There is no evidence or indication in the question that will suggest a decrease in sales of other companies. The reverse may be true- For instance, because of the new regulation the sales of the other companies might have increased!. Hence, A cannot be the answer.
One needs to look for an answer that the argument is inferring/supporting unambiguously. Option D acknowledges that the regulation did not provide the other companies an unprecedented advantage rather other factors such as tax period or safety concerns might have made the sales to remain constant. There is no ambiguity or paradox in this choice, thus the answer.

Hi. The question says that the share of Friendly reduced, however the absolute figure of its sales remained the same. That would simply imply that the total sales increased. If the sales of all other retailers decreased, there is no way the total sales could have increased. Hence, the statement 'A' cannot be true in case.

The question asks us to find the statement that can never be true. IMO, it should unambiguously be A.

My friend, you have already understood the alternative possibility to increase tot sales in Option E. If new companies entered then it's feasible.
However, I understand your confusion regarding the wording of Option A - says, all other had decreased sales volume. But, if you think of a new industry there is nothing to decrease or increase in it's sales volume as it is new.
Hope it helps!

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Re: Over an eleven-month period, during which national retail co [#permalink]

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04 May 2016, 04:45
aswaniwait4u wrote:

My friend, you have already understood the alternative possibility to increase tot sales in Option E. If new companies entered then it's feasible.
However, I understand your confusion regarding the wording of Option A - says, all other had decreased sales volume. But, if you think of a new industry there is nothing to decrease or increase in it's sales volume as it is new.
Hope it helps!

Hi,
You too have answered in a way WHY answer should be A?
Although the NEW ofcourse increase from 0 to what ever it has come to? BUT your point taken for sake of NOT arguing on this point itself that it is neither increased or decreased- DECREASED is also your view and correctly so..

BUT what does the statement I say-
(1) All other computer retailers experienced a drop in their sales volume during the four-month period following the enactment of regulation X.

I am sure you will agree on this part that when we speak of ALL other companies, it has to include the NEW ones too.
BUT we agreed that the NEW cannot increase or decrease.. so finally in ALL other, these NEW ones did not decrease.. SO can the statement be possible --NO

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Re: Over an eleven-month period, during which national retail co [#permalink]

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19 May 2016, 04:24
gmatprep09 wrote:
CAn someone explain the appraoch to tackle this question? Thanks.

Over an eleven-month period, during which national retail computer sales remained stable at 400,000 units per month, sales by the Friendly Computer Stores chain rose 200 percent, increasing the chain’s share of the total market to 7 percent. Other retail stores tried, without success, to attract customers away from the Friendly chain. Then regulation X was imposed on all computer retailers by the federal government. In the ensuing months, Friendly’s total share of the market fell to 4 percent, even though its monthly sales volume remained at the same level it had reached just prior to the enactment of regulation X.

Each of the following, in conjunction with the information presented above, could be true EXCEPT:

(1) All other computer retailers experienced a drop in their sales volume during the four-month period following the enactment of regulation X.

(2) All other computer companies lost some market share during the four-month period prior to the enactment of regulation X.

(3) The enactment of regulation X provided the Friendly chain’s competitors with an advantage they did not previously have.

(4) The enactment of regulation X did not provide the Friendly chain’s competitors with an advantage they did not previously have; other dramatic changes in other market forces caused the decline in the Friendly chain’s market share.

(5) In the period following the enactment of regulation X, many new computer retailers that specialized in low-budget computers entered the marketplace.

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Re: Over an eleven-month period, during which national retail co [#permalink]

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19 May 2016, 15:43
To the "A" folks.....How is A different from E?? They are saying the same thing.

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Re: Over an eleven-month period, during which national retail co [#permalink]

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19 May 2016, 20:54
sashaman14 wrote:
To the "A" folks.....How is A different from E?? They are saying the same thing.

Hi , this question is could be true "except"

E option gives us a reason for the market share decrease , but as per option A if the sales of all 'other' decrease then how can the market share of friendly computers decrease , market share should increase in this case .

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Re: Over an eleven-month period, during which national retail co [#permalink]

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18 Jul 2016, 02:23
gmatprep09 wrote:
CAn someone explain the appraoch to tackle this question? Thanks.

Over an eleven-month period, during which national retail computer sales remained stable at 400,000 units per month, sales by the Friendly Computer Stores chain rose 200 percent, increasing the chain’s share of the total market to 7 percent. Other retail stores tried, without success, to attract customers away from the Friendly chain. Then regulation X was imposed on all computer retailers by the federal government. In the ensuing months, Friendly’s total share of the market fell to 4 percent, even though its monthly sales volume remained at the same level it had reached just prior to the enactment of regulation X.

Each of the following, in conjunction with the information presented above, could be true EXCEPT:

(1) All other computer retailers experienced a drop in their sales volume during the four-month period following the enactment of regulation X.

(2) All other computer companies lost some market share during the four-month period prior to the enactment of regulation X.

(3) The enactment of regulation X provided the Friendly chain’s competitors with an advantage they did not previously have.

(4) The enactment of regulation X did not provide the Friendly chain’s competitors with an advantage they did not previously have; other dramatic changes in other market forces caused the decline in the Friendly chain’s market share.

(5) In the period following the enactment of regulation X, many new computer retailers that specialized in low-budget computers entered the marketplace.

A is no doubt the clear winner, but if you see carefully option D is exact opposite of option C, so no wayt both C and D will be true, thus I chose D.
If that was not the case, I would have marked A.

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Re: Over an eleven-month period, during which national retail co [#permalink]

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18 Jul 2016, 03:36
gmatprep09 wrote:
CAn someone explain the appraoch to tackle this question? Thanks.

Over an eleven-month period, during which national retail computer sales remained stable at 400,000 units per month, sales by the Friendly Computer Stores chain rose 200 percent, increasing the chain’s share of the total market to 7 percent. Other retail stores tried, without success, to attract customers away from the Friendly chain. Then regulation X was imposed on all computer retailers by the federal government. In the ensuing months, Friendly’s total share of the market fell to 4 percent, even though its monthly sales volume remained at the same level it had reached just prior to the enactment of regulation X.

Each of the following, in conjunction with the information presented above, could be true EXCEPT:

(1) All other computer retailers experienced a drop in their sales volume during the four-month period following the enactment of regulation X.

(2) All other computer companies lost some market share during the four-month period prior to the enactment of regulation X.

(3) The enactment of regulation X provided the Friendly chain’s competitors with an advantage they did not previously have.

(4) The enactment of regulation X did not provide the Friendly chain’s competitors with an advantage they did not previously have; other dramatic changes in other market forces caused the decline in the Friendly chain’s market share.

(5) In the period following the enactment of regulation X, many new computer retailers that specialized in low-budget computers entered the marketplace.

OA : A

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Re: Over an eleven-month period, during which national retail co [#permalink]

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05 Aug 2016, 19:22

(4) The enactment of regulation X did not provide the Friendly chain’s competitors with an advantage they did not previously have; other dramatic changes in other market forces caused the decline in the Friendly chain’s market share.

If this is negated, then this contradicts the argument. enactment of X did tip the market in favour of competitors.

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Re: Over an eleven-month period, during which national retail co [#permalink]

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13 Aug 2016, 20:18
Over an eleven-month period, during which national retail computer sales remained stable at 400,000 units per month, sales by the Friendly Computer Stores chain rose 200 percent, increasing the chain’s share of the total market to 7 percent. Other retail stores tried, without success, to attract customers away from the Friendly chain. Then regulation X was imposed on all computer retailers by the federal government. In the ensuing months, Friendly’s total share of the market fell to 4 percent, even though its monthly sales volume remained at the same level it had reached just prior to the enactment of regulation X.

chain share of total market = 7 percent so 28000
previous sales = around 9000 so market share was 2.5%

monthly sales = 28000 but it was 4% so total market 700,000

Each of the following, in conjunction with the information presented above, could be true EXCEPT:

(1) All other computer retailers experienced a drop in their sales volume during the four-month period following the enactment of regulation X. See B

(2) All other computer companies lost some market share during the four-month period prior to the enactment of regulation X. It could be possible and so lets say there are 4 competitors of Friendly chains and earlier they have 20,20,20,27.5 now they have 19,19,19,26.

(3) The enactment of regulation X provided the Friendly chain’s competitors with an advantage they did not previously have.

(4) The enactment of regulation X did not provide the Friendly chain’s competitors with an advantage they did not previously have; other dramatic changes in other market forces caused the decline in the Friendly chain’s market share.

Very Interesting :-
3) and 4) just opposite to each other so only one of them can be true.

And we already know that market share has increased so it can not be 3>
(5) In the period following the enactment of regulation X, many new computer retailers that specialized in low-budget computers entered the marketplace. :- that could be try as we now know that total market has increased.

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Re: Over an eleven-month period, during which national retail co [#permalink]

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23 Aug 2016, 06:05
Guys,

option A is correct if we are not given a "4-month" clause in the statement. It is same with B. However, in option D we have something- "other dramatic changes in other market forces caused the decline"- does that make sense? Isn't it something out of passage?

Please if somebody could elaborate on the OA.

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Re: Over an eleven-month period, during which national retail co [#permalink]

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23 Aug 2016, 08:29
(1) All other computer retailers experienced a drop in their sales volume during the four-month period following the enactment of regulation X.

All of them dropped at same % points or different? Since it is not specified, we shall consider it as same %. So this does not make sense in drop of FCC from 7% to 4%.

(2) All other computer companies lost some market share during the four-month period prior to the enactment of regulation X.

This speaks about preceding month. Not considered.

(3) The enactment of regulation X provided the Friendly chain’s competitors with an advantage they did not previously have.

This tells that competitor were having an advantage after enactment X. But does not specify if they were able to capitalise and gain market share.

(4) The enactment of regulation X did not provide the Friendly chain’s competitors with an advantage they did not previously have; other dramatic changes in other market forces caused the decline in the Friendly chain’s market share.

Since other options have been eliminated, D is the OA.

(5) In the period following the enactment of regulation X, many new computer retailers that specialized in low-budget computers entered the marketplace.

Low budget computers would form only a part of FCC segment. Loss of grounds can not cause almost a 50% drop in market share.

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Re: Over an eleven-month period, during which national retail co [#permalink]

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02 Sep 2016, 06:04

I can think of 1 reason to explain why A is wrong..

Notice the words In the ensuing months in the stimulus?
Ensue means: To come at a later time; to happen as a result (Image attached of Webster). Therefore, the final result of regulation X was a decrease in Market Share of FCS without ...

Whereas the Option says that during the four-month period following the enactment. Now, call me crazy but I can think of a situation in which the Market Share of FCS increased to 7%, then the regulation was enacted, leading to decrease in Market Share of all other companies for 4 Months (Please note again that this happened right after the enactment) and then the Market Share of FCS decreased to 4%, leading to rise in Market Share of atleast 1 other company. Finally consider this - all of this happened in a period of 11 months as mentioned at the start of Stimulus Over an eleven-month period, during which...

Crazy. I know! But this is the only reason to say that option A is possible.

Do not worry. D is Still Wrong. Notice the words could be true EXCEPT in the Question Stem? It gives us freedom to add external data in option so long as we are not violating any premise as we are doing in option E. Hence according to me, this is a Wrong Question.

sriramkrishnan wrote:
(1) All other computer retailers experienced a drop in their sales volume during the four-month period following the enactment of regulation X.

All of them dropped at same % points or different? Since it is not specified, we shall consider it as same %. So this does not make sense in drop of FCC from 7% to 4%.

(2) All other computer companies lost some market share during the four-month period prior to the enactment of regulation X.

This speaks about preceding month. Not considered.

(3) The enactment of regulation X provided the Friendly chain’s competitors with an advantage they did not previously have.

This tells that competitor were having an advantage after enactment X. But does not specify if they were able to capitalise and gain market share.

(4) The enactment of regulation X did not provide the Friendly chain’s competitors with an advantage they did not previously have; other dramatic changes in other market forces caused the decline in the Friendly chain’s market share.

Since other options have been eliminated, D is the OA.

(5) In the period following the enactment of regulation X, many new computer retailers that specialized in low-budget computers entered the marketplace.

Low budget computers would form only a part of FCC segment. Loss of grounds can not cause almost a 50% drop in market share.

Over an eleven-month period, during which national retail computer sales remained stable at 400,000 units per month, sales by the Friendly Computer Stores chain rose 200 percent, increasing the chain’s share of the total market to 7 percent. Other retail stores tried, without success, to attract customers away from the Friendly chain. Then regulation X was imposed on all computer retailers by the federal government. In the ensuing months, Friendly’s total share of the market fell to 4 percent, even though its monthly sales volume remained at the same level it had reached just prior to the enactment of regulation X.

chain share of total market = 7 percent so 28000
previous sales = around 9000 so market share was 2.5%

monthly sales = 28000 but it was 4% so total market 700,000

Each of the following, in conjunction with the information presented above, could be true EXCEPT:

(1) All other computer retailers experienced a drop in their sales volume during the four-month period following the enactment of regulation X. See B

(2) All other computer companies lost some market share during the four-month period prior to the enactment of regulation X. It could be possible and so lets say there are 4 competitors of Friendly chains and earlier they have 20,20,20,27.5 now they have 19,19,19,26.

(3) The enactment of regulation X provided the Friendly chain’s competitors with an advantage they did not previously have.

(4) The enactment of regulation X did not provide the Friendly chain’s competitors with an advantage they did not previously have; other dramatic changes in other market forces caused the decline in the Friendly chain’s market share.

Very Interesting :-
3) and 4) just opposite to each other so only one of them can be true.

And we already know that market share has increased so it can not be 3>
(5) In the period following the enactment of regulation X, many new computer retailers that specialized in low-budget computers entered the marketplace. :- that could be try as we now know that total market has increased.

I have a Few Issues with your comment.
1. I am not Exactly sure what your answer is but I am going to assume that you are saying D is correct.

2. Option A & B are talking about 2 different Set of Months, which are exclusive of each other. Therefore, I couldn't understand how are you trying to explain these 2 options with one single reply.

3. The numbers that you used to explain (they have 20,20,20,27.5 now they have 19,19,19,26) must be for Sale Volume because If they are of Market Share, they don't add up with the data given in the question as FCS has a 7% and 4% MS for 2 respective set of Months while its Sale is constant. Therefore in this context, a decrease in Market Share of FCS means that the total volume of Computers sold, post regulation, must have Increased however, the sum of numbers mentioned by you is decreasing.
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Re: Over an eleven-month period, during which national retail co [#permalink]

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23 Sep 2016, 07:55
So what if Friendly computers decided to lower their prices which made their margins smaller, but buyers didn't make their decisions based on price. This way they would have had the same sales volume. At the same time Friendly's competitors came out with a high end computer that was of no interest to Friendlys consumers, but was very interesting to s new group of buyers that were not previously in the market.
Government had nothing to do with this situation.

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24 Sep 2016, 11:20
aainscough wrote:
So what if Friendly computers decided to lower their prices which made their margins smaller, but buyers didn't make their decisions based on price. This way they would have had the same sales volume. At the same time Friendly's competitors came out with a high end computer that was of no interest to Friendlys consumers, but was very interesting to s new group of buyers that were not previously in the market.
Government had nothing to do with this situation.

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When we say that a computer company XYZ has a market share of 7%, we mean that if 100 computers are sold, 7 out of them were XYZ's. This is Market Share in terms of Volume. Market share may also be in in terms of Revenue, Profit, and any other indicator such as advertising expense.

Therefore, the entry of new Consumers does not alter this dynamics unless you enter a new demographic filter such as ethnicity, gender, age, and so on.
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Re: Over an eleven-month period, during which national retail co [#permalink]

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24 Sep 2016, 11:43
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25 Sep 2016, 21:27
But new customers means new computers will be sold, the market just grew and Friendly captured 0% of the new market.

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Re: Over an eleven-month period, during which national retail co [#permalink]

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07 Oct 2016, 10:05
gmatprep09 wrote:
CAn someone explain the appraoch to tackle this question? Thanks.

Over an eleven-month period, during which national retail computer sales remained stable at 400,000 units per month, sales by the Friendly Computer Stores chain rose 200 percent, increasing the chain’s share of the total market to 7 percent. Other retail stores tried, without success, to attract customers away from the Friendly chain. Then regulation X was imposed on all computer retailers by the federal government. In the ensuing months, Friendly’s total share of the market fell to 4 percent, even though its monthly sales volume remained at the same level it had reached just prior to the enactment of regulation X.

Each of the following, in conjunction with the information presented above, could be true EXCEPT:

(1) All other computer retailers experienced a drop in their sales volume during the four-month period following the enactment of regulation X.

(2) All other computer companies lost some market share during the four-month period prior to the enactment of regulation X.

(3) The enactment of regulation X provided the Friendly chain’s competitors with an advantage they did not previously have.

(4) The enactment of regulation X did not provide the Friendly chain’s competitors with an advantage they did not previously have; other dramatic changes in other market forces caused the decline in the Friendly chain’s market share.

(5) In the period following the enactment of regulation X, many new computer retailers that specialized in low-budget computers entered the marketplace.

Hi

Stimulus say

For 11 months market size was constant = 400000 units
F computer store MS = 7%
F computer store sales volume 11th month = X

After this , Regulation come In
Result

F computer store MS = 4%
F computer store sales volume = X

Decrease in store's market share and no change in store's sales volume can only happen if the overall market size increase or in other words competitor stores sales volume increase.

Prethinking :

Any Answer choice which says regulation did not help competitors of F store ( No help , No increase in there sales) can be a potential answer.

Hope it helps

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Re: Over an eleven-month period, during which national retail co [#permalink]

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22 Oct 2016, 14:24
abhimahna wrote:

Since the no. of months is not determined by the phrase "ensuing months", option A is possible if the "ensuing months" is not equal to 4 months.

Nonetheless, D may also be true - implementation of X may just be coincidental and not causal. It is possible that some other regulation Y was implemented and that caused this change in market scenario.

So, in my view all options could be true.

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Re: Over an eleven-month period, during which national retail co [#permalink]

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22 Oct 2016, 23:08
sayantanc2k wrote:
abhimahna wrote:

Since the no. of months is not determined by the phrase "ensuing months", option A is possible if the "ensuing months" is not equal to 4 months.

Nonetheless, D may also be true - implementation of X may just be coincidental and not causal. It is possible that some other regulation Y was implemented and that caused this change in market scenario.

So, in my view all options could be true.

Thanks brother.

So, should I consider this question not GMAT Like?
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Re: Over an eleven-month period, during which national retail co   [#permalink] 22 Oct 2016, 23:08

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