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Author Message
Intern
Joined: 02 May 2017
Posts: 11

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07 Jul 2017, 11:42
The following appeared as part of the business plan of an investment and financial consulting firm.
“Studies suggest that an average coffee drinker’s consumption of coffee increases with age, from age 10 through age 60. Even after age 60, coffee consumption remains high. The average cola drinker’s consumption of cola, however, declines with increasing age. Both of these trends have remained stable for the past 40 years. Given that the number of older adults will significantly increase as the population ages over the next 20 years, it follows that the demand for coffee will increase and the demand for cola will decrease during this period. We should, therefore, consider transferring our investments from Cola Loca to Early Bird Coffee.”
Discuss how well reasoned... etc.
.....................................................................................................................................................................

The argument claims that business plan of the firm is considering to move all its investments from Cola Loca to Early Bird Coffee.
The basis of this argument fails to consider several key factors, on the basis of which it could be evaluated. The conclusion is based on assumptions, for which there is no clear evidence. Hence the argument is weak and unconvincing.
First, the author claims , with the help of a study that the consumption of coffee increases with the average age of coffee drinker , whereas consumption of Cola decreases with increase in age. The author fails to highlight whether this study is reliable or not.
He fails to mention whether the survey that the study did was for a sample population , a town or during a hot summer afternoon. Without any of these factors available and unknown, it is difficult to evaluate whether this assumption is true or not.
The author should strengthen this assumption by providing any relevant statistic or key points of interest that the study used in order to establish the trend. For instance, if the author mentioned , that this study was conducted on a group of unaware citizens who have similar inclination towards coffee as Cola, it would help establish validity of the trend. In the absence of these relevant factors, this assumption is weak.
Second, the author states that over the next 20 years, the older population would increase and so will the increase in demand for coffee.
The author, here, assumes wrongly that even after 60 years of age, people would stick to coffee and not switch to any healthier alternatives. He even fails to consider that withthin the next 20 years , a new generation would be added to the range of the targeted population. With this new addition, whether the trend will still remain the same or not, it is hard to assess. The author could strengthen the argument if he mentioned that there were no other alternatives to coffee or Cola in the areas that the study was conducted. He could further strengthen the argument, by providing additional factors as to why the population would choose Coffee over Cola. Without these pieces of additional information, the assumption is unsubstantiated.
Finally, the author mentions that on the basis of the trend, and the rise in demand of coffee over Cola, the firms should move all its investments from Cola Loca to Early Bird Coffee. The author fails to provide any kind of relationship between the increase in demand to the success of an investment. It could be possible that even though the demand of Cola is declining with age, the investment could be doing far better than Coffee because of itshigh performing management. The author could strengthen this assumption, if he provided any trend from a credible valid well substantiated study that, increase in demand directly implied success of an investment as it would lead the share holders to retain their shares longer. Without these additional factors, this assumption is also flawed and unconvincing.
In summary the argument is weak and unconvincing. It could be strengthened if the author better substantiated it or provided relevant facts.In order to assess the merits of an argument, it is essential to have complete knowledge of all the contributing factors. However, as it stands, the argument is flawed and unsubstantiated.
Board of Directors
Joined: 01 Sep 2010
Posts: 3388

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08 Jul 2017, 02:50
Top Contributor
Quite good. Not so much to point out.

Feel free to ask, if necessary.

Also, look at here for reference https://gmatclub.com/forum/gmatclub-gui ... 36251.html
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Intern
Joined: 02 May 2017
Posts: 11

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08 Jul 2017, 06:38
Are there errors I need to look out for? Or perhaps identifying the points or the structure of the argument?
How would this argument be rated?

Posted from my mobile device
Board of Directors
Joined: 01 Sep 2010
Posts: 3388

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08 Jul 2017, 08:35
Top Contributor
Some redundancy, not so clear pronun reference, slight not fluence in its unfolding but overall is good. 4.5>

Sent from my SM-N910F using GMAT Club Forum mobile app
_________________
Intern
Joined: 02 May 2017
Posts: 11

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08 Jul 2017, 08:42
I think I understand how I could unfold more. But if you can, can you please point out the exact places of redundancy? I have a hunch but it would be great if you could.
Thanks!

Posted from my mobile device
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