In an effort to boost sales during the summer months, which are typically the best for soft-drink sales Foamy Soda lowered its prices. In spite of this, however, the sales of Foamy Soda dropped during the summer months.
Each of the following, if true, contributes to reconciling the apparent discrepancy indicated above EXCEPT:Note: As this is an except question, we will find all the options that contributes to the decrease in sales and the one remaining will be Our Answer.Conclusion: The sales of Foamy Soda dropped during the summer months.
Premise: In an effort to boost sales during the summer months, which are typically the best for soft-drink sales Foamy Soda lowered its prices
Analysis: As we can see from the above conclusion and premise, there is some discrepancy as to why the sales did not increase in summer even though the prices were decreased.
Lets find out all the options which will point to those discrepancy:
A) The soft-drink industry as a whole experienced depressed sales during the summer months.
{If the whole industry is facing trouble than that same trouble is faced by the Foamy Soda company, which in turn decreases sales of Foamy Soda company}
(B) Foamy Soda’s competitors lowered their prices even more drastically during the summer months.
{ Obviously if the prices of competitors are more reduced, then people will buy from competitors, which in turn decreases sales of Foamy Soda company}
(C) Because of an increase in the price of sweeteners the production costs of Foamy Soda rose during the summer months.{This does not tell anything about sales.If the price of sweeteners has increased,then that would effect the whole industry. However this may/may not have an impact on sales. Lets keep it.}
(D) A strike at Foamy Soda’s main plant forced production cutbacks that resulted in many stores not receiving their normal shipments during the summer months.
{ This clearly indicates decrease in sales as the distribution is hampered}(E) The weather during the summer months was unseasonably cool, decreasing the demand for soft drinks.
{If the demand is decreased then people drink fewer sodas,hampering the soda business of poor Foamy Soda }We are left with C.