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Printwell’s Ink Jet Division manufactures ink-jet printers and the ink

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Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 12 Jun 2005, 20:38
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Printwell’s Ink Jet Division manufactures ink-jet printers and the ink cartridges they use. Sales of its ink-jet printers have increased. Monthly revenues from those sales, however, have not increased, because competition has forced Printwell to cut the prices of its printers. Unfortunately, Printwell has been unable to bring down the cost of manufacturing a printer. Thus, despite the increase in printer sales, the Ink Jet Division must be contributing less to the company's profits than it used to.

Which of the following, if true, most seriously weakens the argument?

(A) Ink-jet printers in regular use frequently need new ink cartridges, and Printwell’s printers only accept Printwell’s ink cartridges.

(B) Unlike some competing companies, Printwell sells all of its printers through retailers, and these retailers’ costs account for a sizable proportion of the printers’ ultimate retail price.

(C) Some printer manufacturers have been forced to reduce the sale price of their ink-jet printers even more than Printwell has.

(D) In the past year, no competing manufacturer of ink-jet printers has had as great an increase in unit sales of printers as Printwell has.

(E) In the past year, sales of Printwell’s ink-jet printers have increased more than sales of any other type of printer made by Printwell.
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 17 Dec 2006, 09:16
Printwell’s Ink Jet Division manufactures ink-jet printers and the ink cartridges they use. Sales of its ink-jet printers have increased. Monthly revenues from those sales, however, have not increased, because competition has forced Printwell to cut the prices of its printers. Unfortunately, Printwell has been unable to bring down the cost of manufacturing a printer. Thus, despite the increase in printer sales, the Ink Jet Division must be providing the company with much smaller profits than it used to.
Which of the following, if true, most seriously weakens the argument?



( A ) Ink-jet printers in regular use frequently need new ink cartridges, and Printwell’s printers only accept Printwell’s ink cartridges.
( B ) Unlike some competing companies, Printwell sells all of its printers through retailers, and these retailers’ costs account for a sizable proportion of the printers’ ultimate retail price.
( C ) Some printer manufacturers have been forced to reduce the sale price of their ink-jet printers even more than Printwell has.
( D ) In the past year, no competing manufacturer of ink-jet printers has had as great an increase in unit sales of printers as Printwell has.
( E ) In the past year, sales of Printwell’s ink-jet printers have increased more than sales of any other type of printer made by Printwell.
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 17 Dec 2006, 09:28
I will go with A. Given that we don't know how much it costs to manufacture the ink cartriges, A may not be the right reasoning, but none of the other choices seem appropriate either.
anindyat wrote:
Printwell’s Ink Jet Division manufactures ink-jet printers and the ink cartridges they use. Sales of its ink-jet printers have increased. Monthly revenues from those sales, however, have not increased, because competition has forced Printwell to cut the prices of its printers. Unfortunately, Printwell has been unable to bring down the cost of manufacturing a printer. Thus, despite the increase in printer sales, the Ink Jet Division must be providing the company with much smaller profits than it used to.
Which of the following, if true, most seriously weakens the argument?



( A ) Ink-jet printers in regular use frequently need new ink cartridges, and Printwell’s printers only accept Printwell’s ink cartridges.
( B ) Unlike some competing companies, Printwell sells all of its printers through retailers, and these retailers’ costs account for a sizable proportion of the printers’ ultimate retail price.
The conclusion about lower profits may not have anything to do with this, because retail cost seems to be afixed cost.

( C ) Some printer manufacturers have been forced to reduce the sale price of their ink-jet printers even more than Printwell has.
The argument is only about Printwell, not others.
( D ) In the past year, no competing manufacturer of ink-jet printers has had as great an increase in unit sales of printers as Printwell has.
Same as C
( E ) In the past year, sales of Printwell’s ink-jet printers have increased more than sales of any other type of printer made by Printwell.
we already know that, question was about profits
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 17 Dec 2006, 16:35
Must show a reason why Printwell is NOT providing the company with smaller profits.

How?

by increasing sales of their other product, ink cartridges

A for me too. Only one that shows a direct impact on profits.
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 20 Dec 2006, 18:40
The first statement in the question stim. leads me to think of the ink cartridges before reading the answer choices.

So it is A
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 01 Jan 2007, 15:53
We have to find the assumption that attacks the conclusion. A does exactly that: even if printer revenues have decreased, if the cartridges are bound to the printers, the ink jet division can still provide the company with higher profits.
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 27 Jan 2008, 03:40
since the question does not talk abt the competing businesses in the printer industry, B C D are out...even if the inkjet printers are witnessing lower sales (as a result of lower prices), frequently demanded inkjet cartridges will compensate for the decline thereby weakening the argument that sales will be lower..
E is out of scope as well..
i m not sure abt the approach though...whats the OA?
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 13 Jul 2013, 10:07
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I'm Responding to a PM

swati007 wrote:


ANALYZE THE STIMULUS:

Fact: Printwell’s Ink Jet Division manufactures both ink-jet printers and the ink cartridges they use.
Fact: Sales of its ink-jet printers have increased.
Fact: But monthly revenues from those sales have not increased, because competition has forced Printwell to cut the prices of its printers.
Fact: Printwell has been unable to bring down the cost of manufacturing a printer.
Conclusion: Despite the increase in printer sales, the Ink Jet Division must be providing the company with much smaller than it used to.

Pre-thingking: We know: Ink Jet Division revenues = revenues from printer sales + revenues from cartridges sales. The argument says ONLY “revenues from printers sales have NOT increased”, and concludes that “Ink Jet Division TOTAL revenues must be smaller”. To weaken this argument, we can show that even though revenues from printers sales DECREASES, but revenues from cartridges sales INCREASE ==> Total revenues will not be smaller.

ANALYZE EACH ANSWER:

A. Ink-jet printers in regular use frequently need new ink cartridges, and Printwell’s printers only accept Printwell’s ink cartridges.
Correct. A states that it’s possible that revenues from cartridges sales will increase. KEY word “in regular use frequently”.

B. Unlike some competing companies, Printwell sells all of its printers through retailers, and these retailers’ costs account for a sizable proportion of the printers’ ultimate retail price.
Wrong. B may strengthen the conclusion (. The retailers’ cost is additional cost that makes a negative effect for the Ink Jet Division.

C. Some printer manufacturers have been forced to reduce the sale price of their ink-jet printers even more than Printwell has.
Wrong. Ink Jet Division’s revenue may be still smaller if its sales from printers and cartridges do not increases. The argument clearly states that “revenue from printers sales have not increased”, so the fact that other manufactures reduces their printers prices DOES NOT affect the conclusion.

D. In the past year, no competing manufacturer of ink-jet printers has had as great an increase in unit sales of printers as Printwell has.
Wrong. We do not talk about “the past”. D is out.

E. In the past year, sales of Printwell’s ink-jet printers have increased more than sales of any other type of printer made by Printwell.
Wrong. Same as D. In this case, the fact in the past does not help you weaken a conclusion that talks about the future.

Hope it helps.
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 13 Jul 2013, 13:49
Guilty, I answered E. After rethinking, and reading everyone's comments, it's so obviously A

Total Division Profits = Printer Profits + Cartridge Profits
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 23 Dec 2013, 16:17
Does GMAT use Sales (the absolute value) and Sales Unit (quantity of units) interchangeably?

This problems appears to do so, in connect with answer E. Answer E "...sales of Printwell's ink-jet division printers have increased more than sales of any other type of printer..." does not reconcile with the stimulus "Monthly revenues from those sales, however, have not increased." If so, it's very annoying.

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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 12 Jan 2014, 10:00
Printwell’s Ink Jet Division manufactures ink-jet printers and the ink cartridges they use. Sales of its ink-jet printers have increased. Monthly revenues from those sales, however, have not increased, because competition has forced Printwell to cut the prices of its printers. Unfortunately, Printwell has been unable to bring down the cost of manufacturing a printer. Thus, despite the increase in printer sales, the Ink Jet Division must be providing the company with much smaller than it used to.

Which of the following, if true, most seriously weakens the argument?

A. Ink-jet printers in regular use frequently need new ink cartridges, and Printwell’s printers only accept Printwell’s ink cartridges.
B. Unlike some competing companies, Printwell sells all of its printers through retailers, and these retailers’ costs account for a sizable proportion of the printers’ ultimate retail price.
C. Some printer manufacturers have been forced to reduce the sale price of their ink-jet printers even more than Printwell has.
D. In the past year, no competing manufacturer of ink-jet printers has had as great an increase in unit sales of printers as Printwell has.
E. In the past year, sales of Printwell’s ink-jet printers have increased more than sales of any other type of printer made by Printwell.

Cutting the selling price caused sales of its printer to surge, if Printwell printer runs exclusively Printwell cartridges the revenues from cartridges will surge as well. This way the company's management could avoid slashing funds devoted to its development division.
A.

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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 21 May 2014, 00:28
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umeshpatil wrote:
What is meant by "the Ink Jet Division must be providing the company with much smaller than it used to." which is part of conclusion ?


Hi Umesh

the Ink Jet Division must be providing the company with much smaller than it used to” would be weakened.

This statement is the conclusion of the argument. It talks about the contribution of Ink Jet Division. According to the statement, the contribution of Ink Jet Division must be smaller than it used to.

Let's look at the argument:

Sales of its ink-jet printers have increased.

Monthly revenues from those sales, however, have not increased, because competition has forced Printwell to cut the prices of its printers.

Unfortunately, Printwell has been unable to bring down the cost of manufacturing a printer.


Now, we know from the passage that despite the increase in sales, the revenues have not increased and cost of manufacturing a printer has not declined. This would mean that profit per unit can be smaller than it used to be.

Revenue - cost= Profit (contribution to the company)

However, the conclusion is drawn upon the contribution of the Ink Jet Division and not just the contribution of the Ink Jet printers. As given, Ink Jet Division manufactures ink-jet printers and the ink cartridges they use. Hence, if the profit from the sales of cartridges is large enough to compensate or exceed the decline in contribution from the sales of printer, conclusion that “the Ink Jet Division must be providing the company with much smaller than it used to” would be weakened.

Does it help?
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 21 May 2014, 01:02
Hi Dolly,
thanks for reply :-D . First Kudo for you !
I only wanted to get little explanation on below unfinished sentence, which is conclusion that is required to weaken.
"the Ink Jet Division must be providing the company with much smaller than it used to??."
Can you please tell me ?
1. must be providing the company... which company ?
2. smaller than it used to .. what it is used to ?
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 21 May 2014, 02:02
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umeshpatil wrote:
Hi Dolly,
thanks for reply :-D . First Kudo for you !
I only wanted to get little explanation on below unfinished sentence, which is conclusion that is required to weaken.
"the Ink Jet Division must be providing the company with much smaller than it used to??."
Can you please tell me ?
1. must be providing the company... which company ?
2. smaller than it used to .. what it is used to ?



Thanks for the appreciation! :)

A company can hold several divisions. A division is a part of the company such as sales division, marketing division and operations division.

1) The company mentioned in the argument is the one that holds Ink Jet division.

Suppose you have a company U. It has several divisions such as Ink Jet division, laser division and other divisions. Ink Jet division used to provide 40% of company's overall profit.

This means if the total profit of the company used to be $100. Ink Jet provided $40 to the company.

Now the conclusion is that Ink Jet division must be providing smaller than it used to.

2) This means that the contribution of the Ink Jet division must be lesser than $40.

Used to refer to the contribution of Ink Jet Division to the company in the past.



Does this help?

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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 20 Nov 2015, 02:40
There are two major inferences one must draw from the first statement i.e. Printwell’s Ink Jet Division manufactures ink-jet printers and the ink cartridges they use. Sales of its ink-jet printers have increased.

1. The division manufactures both printers and ink for the printers
2. the sale has increased - that implies there are more number of printers from this particular manufacturer. So, while I might not be able to make more out of a product but I am the only one who has the stuff that runs the product. In this case, the printer and the ink. This fact is further supplemented by option A.

Hope this helped!
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 10 Oct 2016, 09:33
1
Printwell’s Ink Jet Division manufactures ink-jet printers and the ink cartridges they use. Sales of its ink-jet printers have increased. Monthly revenues from those sales, however, have not increased, because competition has forced Printwell to cut the prices of its printers. Unfortunately, Printwell has been unable to bring down the cost of manufacturing a printer. Thus, despite the increase in printer sales, the Ink Jet Division must be providing the company with much smaller than it used to.

Which of the following, if true, most seriously weakens the argument?

A. Ink-jet printers in regular use frequently need new ink cartridges, and Printwell’s printers only accept Printwell’s ink cartridges.
B. Unlike some competing companies, Printwell sells all of its printers through retailers, and these retailers’ costs account for a sizable proportion of the printers’ ultimate retail price.
C. Some printer manufacturers have been forced to reduce the sale price of their ink-jet printers even more than Printwell has.
D. In the past year, no competing manufacturer of ink-jet printers has had as great an increase in unit sales of printers as Printwell has.
E. In the past year, sales of Printwell’s ink-jet printers have increased more than sales of any other type of printer made by Printwell.
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 10 Oct 2016, 09:33
Printwell’s Ink Jet Division manufactures ink-jet printers and the ink cartridges they use. Sales of its ink-jet printers have increased. Monthly revenues from those sales, however, have not increased, because competition has forced Printwell to cut the prices of its printers. Unfortunately, Printwell has been unable to bring down the cost of manufacturing a printer. Thus, despite the increase in printer sales, the Ink Jet Division must be providing the company with much smaller than it used to.

Which of the following, if true, most seriously weakens the argument?

A. Ink-jet printers in regular use frequently need new ink cartridges, and Printwell’s printers only accept Printwell’s ink cartridges.
B. Unlike some competing companies, Printwell sells all of its printers through retailers, and these retailers’ costs account for a sizable proportion of the printers’ ultimate retail price.
C. Some printer manufacturers have been forced to reduce the sale price of their ink-jet printers even more than Printwell has.
D. In the past year, no competing manufacturer of ink-jet printers has had as great an increase in unit sales of printers as Printwell has.
E. In the past year, sales of Printwell’s ink-jet printers have increased more than sales of any other type of printer made by Printwell.

EDITED BY Abhishek009 : THREADS MERGED , PEASE DO NOT CREATE MULTIPLE THREADS FOR THE SAME QUESTION
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 10 Oct 2016, 11:35
felippemed wrote:
Printwell’s Ink Jet Division manufactures ink-jet printers and the ink cartridges they use. Sales of its ink-jet printers have increased. Monthly revenues from those sales, however, have not increased, because competition has forced Printwell to cut the prices of its printers. Unfortunately, Printwell has been unable to bring down the cost of manufacturing a printer. Thus, despite the increase in printer sales, the Ink Jet Division must be providing the company with much smaller than it used to.

Which of the following, if true, most seriously weakens the argument?

A. Ink-jet printers in regular use frequently need new ink cartridges, and Printwell’s printers only accept Printwell’s ink cartridges.
B. Unlike some competing companies, Printwell sells all of its printers through retailers, and these retailers’ costs account for a sizable proportion of the printers’ ultimate retail price.
C. Some printer manufacturers have been forced to reduce the sale price of their ink-jet printers even more than Printwell has.
D. In the past year, no competing manufacturer of ink-jet printers has had as great an increase in unit sales of printers as Printwell has.
E. In the past year, sales of Printwell’s ink-jet printers have increased more than sales of any other type of printer made by Printwell.


Indeed answer is (A) , here goes my understanding -

Quote:
Printwell’s Ink Jet Division manufactures ink-jet printers and the ink cartridges they use.


Attachment:
Untitled.png
Untitled.png [ 4.85 KiB | Viewed 2379 times ]


Quote:
Sales of its ink-jet printers have increased. Monthly revenues from those sales, however, have not increased, because competition has forced Printwell to cut the prices of its printers.


Revenue = Selling Price x No of Units Sold

Quote:
Thus, despite the increase in printer sales, the Ink Jet Division must be providing the company with much smaller than it used to.


Then it goes to straightaway blaming the Ink Jet Division for the decreased revenue of ink-jet printers , however it ignores the fact that the other division might be contributing more than it used to..

Option (A) does that elegantly...
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 11 Oct 2016, 00:37
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When you have data, it is better to write them down as an equation -

for the printer division
Profits = Revenues - costs. We have been told that costs have increased. We have been told that revenues have either reduced or remained the same (because the prices of printers have dropped) and the costs have either increased or remained the same.
Obviously then, the profits for the printer division must decline.

However, notice carefully what the conclusion says - "despite the increase in printer sales, the Ink Jet Division must be providing the company with much smaller than it used to."
The conclusion now talks about the entire division, not just the printers.
Hence,
profits for inkjet division = profits for inkjet printers + profits for ink cartridges.
we know that the first term on the RHS has reduced. To weaken the argument (that is to say that profits from the inkjet division have increased) the second term on the RHS must increase. Only option A says this.

A - correct answer. It states that since sales of inkjet printers have increased, the sales of ink cartridges must also increase, leading to higher profits in the ink cartridge department.
B - Not relevant to the argument, unless we are told that retailers have substantially reduced their costs. (this can then compensate for the reduction in prices).
C- We are not concerned with other manufacturers. Not relevant.
D- does not affect the argument. We know that revenues = unit sales * price. Even though unit sales have increased, the price has reduced. The revenues have not increased.
E - Not relevant. We are concerned only with the inkjet division.
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink [#permalink]

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New post 03 Feb 2017, 05:40
Sale of injket printers have increased but profit from sales has not. Now say the US has ~1,000,000 inkjet printers (already sold) and say every month each printer on an avg needs a new cartridge which has a higher profit margin. Wouldn't the sale of inkjet cartridges every month generate more profit for Printwell?
A it is.
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Re: Printwell’s Ink Jet Division manufactures ink-jet printers and the ink   [#permalink] 03 Feb 2017, 05:40

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