Bunuel wrote:
Tireworld’s marketing plan previously centered around numerous costly marketing campaigns targeted to individual states. This year Tireworld executives plan to switch to a more cost-efficient nationwide marketing campaign. In this way, they hope to increase overall company profits merely by spending less on their marketing.
Which of the following, if true, indicates a flaw in the executive’s plan to increase overall company profits?
A. Many tire companies that are smaller than Tireworld have used nationwide campaigns to increase their profits.
B. Regional climatic conditions and local competition are extremely important factors in marketing tires.
C. During the last two years, Tireworld has sold ten percent of its tires to the military.
D. Many tires are bought only in emergency situations, in which brand preferences are of little concern.
E. Statewide tire-marketing campaigns often employ radio-advertisement stars in order to promote products.
CR16880
As soon as we see the word PROFIT, we should be thinking:
PROFIT = REVENUE - EXPENSESThe plan is that, by reducing marketing EXPENSES, PROFITS will increase.
Notice that the passage doesn't mention anything about REVENUE.
The assumption here is that the nationwide marketing campaign won't result in a decrease in REVENUE
So, it's quite likely that the correct answer will address the missing information concerning REVENUE.
More importantly, the correct answer will likely suggest that moving to a nationwide marketing campaign will negatively impact REVENUE
Let's check the answer choices....
A. Many tire companies that are smaller than Tireworld have used nationwide campaigns to increase their profits.
If anything, this answer choice suggests that there is no flaw with the original argument.B. Regional climatic conditions and local competition are extremely important factors in marketing tires.
BINGO! This suggests that moving to a nationwide marketing campaign will negatively impact REVENUE, since each region of the country has tire requirements specific to that regionC. During the last two years, Tireworld has sold ten percent of its tires to the military.
This provides no information (directly or indirectly) about REVENUED. Many tires are bought only in emergency situations, in which brand preferences are of little concern.
There's nothing here to suggest that moving to a nationwide marketing campaign will negatively impact REVENUEE. Statewide tire-marketing campaigns often employ radio-advertisement stars in order to promote products.
A nationwide marketing campaign can still employ radio-advertisement stars in order to promote productsAnswer: B
Cheers,
Brent