Events & Promotions
|
|
GMAT Club Daily Prep
Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.
Customized
for You
Track
Your Progress
Practice
Pays
Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.
Jul 1311:00 AM EDT
-12:30 PM EDT
Looking for your GMAT motivation to break through the score plateau? Pragati improved her score by massive 160 points with strategic guidance and hard-work! Find out how personalized mentorship and a strong mindset can turn GMAT struggles into success.
Jul 0901:00 PM EDT
-02:00 PM EDT
More Target Test Prep students are earning 100th percentile GMAT scores. Don’t settle for less when the Target Test Prep course gives you everything you need to score high on the GMAT. Start your 5-day free trial today.
Jul 1206:30 AM PDT
-08:30 AM PDT
Join our webinar to master GMAT RC Main Point Questions! Learn effective strategies to decipher passage themes and purposes. Senior Verbal Expert- Sunita Singhvi will equip you with tools to navigate complexities and avoid common traps set by the GMAT.
Jul 1508:00 PM PDT
-09:00 PM PDT
Full-length FE mock with insightful analytics, weakness diagnosis, and video explanations!
Jul 1611:00 AM EDT
-12:00 PM EDT
Prefer video-based learning? The Target Test Prep OnDemand course is a one-of-a-kind video masterclass featuring 400 hours of lecture-style teaching by Scott Woodbury-Stewart, founder of Target Test Prep and one of the most accomplished GMAT instructors.
Jul 1911:00 AM IST
-01:00 PM IST
Do RC/MSR passages scare you? e-GMAT is conducting a masterclass to help you learn – Learn effective reading strategies Tackle difficult RC & MSR with confidence Excel in timed test environment
02 Mar 2010, 11:45
Kudos
Bookmarks
A
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
55%
(hard)
Question Stats:
65% (02:00) correct
35%
(02:22)
wrong
based on 6548
sessions
History
Date
Time
Result
Not Attempted Yet
Products sold under a brand name used to command premium prices because, in general, they were superior to nonbrand rival products. Technical expertise in product development has become so widespread, however, that special quality advantages are very hard to obtain these days and even harder to maintain. As a consequence, brand-name products generally neither offer higher quality nor sell at higher prices. Paradoxically, brand names are a bigger marketing advantage than ever.
Which of the following, if true, most helps to resolve the paradox outlined above?
(A) Brand names are taken by consumers as a guarantee of getting a product as good as the best rival products.
(B) Consumers recognize that the quality of products sold under invariant brand names can drift over time.
(C) In many acquisitions of one corporation by another, the acquiring corporation is interested more in acquiring the right to use certain brand names than in acquiring existing production facilities.
(D) In the days when special quality advantages were easier to obtain than they are now, it was also easier to get new brand names established.
(E) The advertising of a company’s brand-name products is at times transferred to a new advertising agency, especially when sales are declining.
Which of the following, if true, most helps to resolve the paradox outlined above?
(A) Brand names are taken by consumers as a guarantee of getting a product as good as the best rival products.
(B) Consumers recognize that the quality of products sold under invariant brand names can drift over time.
(C) In many acquisitions of one corporation by another, the acquiring corporation is interested more in acquiring the right to use certain brand names than in acquiring existing production facilities.
(D) In the days when special quality advantages were easier to obtain than they are now, it was also easier to get new brand names established.
(E) The advertising of a company’s brand-name products is at times transferred to a new advertising agency, especially when sales are declining.
I answered D but it is incorrect- D states that it was easier to get brand names established. What it means is that today is it difficult to establish a brand name. I believe that explains the paradox as even though good quality products can be made by any one it is difficult to create a brand name and for those who have created it- they have a marketing edge and that is what the question is asking.Can someone tell me whats wrong with this logic
zest4mba
Products sold under a brand name used to command premium prices because, in general, they were superior to
nonbrand rival products. Technical expertise in product development has become so widespread, however, that
special quality advantages are very hard to obtain these days and even harder to maintain. As a consequence,
brand-name products generally neither offer higher quality nor sell at higher prices. Paradoxically, brand names
are a bigger marketing advantage than ever.
Which of the following, if true, most helps to resolve the paradox outlined above?
(A) Brand names are taken by consumers as a guarantee of getting a product as good as the best rival
products.
(B) Consumers recognize that the quality of products sold under invariant brand names can drift over time.
(C) In many acquisitions of one corporation by another, the acquiring corporation is interested more in
acquiring the right to use certain brand names than in acquiring existing production facilities.
(D) In the days when special quality advantages were easier to obtain than they are now, it was also easier to
get new brand names established.
(E) The advertising of a company’s brand-name products is at times transferred to a new advertising agency,
especially when sales are declining.
I answered D but it is incorrect- D states that it was easier to get brand names established. What it means is that today is it difficult to establish a brand name. I believe that explains the paradox as even though good quality products can be made by any one it is difficult to create a brand name and for those who have created it- they have a marketing edge and that is what the question is asking.Can someone tell me whats wrong with this logic
nonbrand rival products. Technical expertise in product development has become so widespread, however, that
special quality advantages are very hard to obtain these days and even harder to maintain. As a consequence,
brand-name products generally neither offer higher quality nor sell at higher prices. Paradoxically, brand names
are a bigger marketing advantage than ever.
Which of the following, if true, most helps to resolve the paradox outlined above?
(A) Brand names are taken by consumers as a guarantee of getting a product as good as the best rival
products.
(B) Consumers recognize that the quality of products sold under invariant brand names can drift over time.
(C) In many acquisitions of one corporation by another, the acquiring corporation is interested more in
acquiring the right to use certain brand names than in acquiring existing production facilities.
(D) In the days when special quality advantages were easier to obtain than they are now, it was also easier to
get new brand names established.
(E) The advertising of a company’s brand-name products is at times transferred to a new advertising agency,
especially when sales are declining.
I answered D but it is incorrect- D states that it was easier to get brand names established. What it means is that today is it difficult to establish a brand name. I believe that explains the paradox as even though good quality products can be made by any one it is difficult to create a brand name and for those who have created it- they have a marketing edge and that is what the question is asking.Can someone tell me whats wrong with this logic
This question is quite interesting and difficult at the same time. The problem some of us have encountered in selecting option D is that we have used our common but outside knowledge. The knowledge is that a branded product has an advantage over a non-branded product. But the main question relevant to this passage is how? How does a branded product has an advantage over a non-branded product?
Think like a Company
Before answering this "how", please understand that we are thinking of this advantage in terms of the company because the last line clearly says that "brand names are a bigger marketing advantage than ever.". This marketing advantage cannot be used for the consumers, it is for the company who owns the product.
So, how does a branded product has an advantage over a non-branded product? There could be only two factors: higher price or higher sales. In other words, the product could generate greater profits per unit or sell more units. In either way, the company would be at an advantage.
In our current case, it is given that the product doesn't sell at a higher price but still it given a marketing advantage. So, now the other way of giving advantage is through increased sales.
So, if an option statement suggests that people will buy branded products more than unbranded products, that would resolve the paradox - The paradox is that even though the branded products don't offer higher price, they are still a marketing advantage
Guaranteed Quality at the same price
Now, as we go through the options, we see that option A provides a very valid reason to suggest that branded products will sell more than unbranded products. Why? Because at the same price, you are getting a guarantee of quality if you buy a branded product.
Therefore, option A is the correct choice.
However, let's also look at option D.
This basically says that brand names are difficult to get established now. But it doesn't say that how these brand names are a marketing advantage even though they don't allow us to charge higher. Here, some of us have used our common knowledge that brand names are an advantage in all situations. But we can't use this common knowledge here.
Hope this helps
Feel free to ask in case of further queries.
-Chiranjeev
19 Dec 2012, 21:22
Kudos
Bookmarks
The OA is A.
I chose B initially. But after reviewing the Q and A, here is why I think the answer is A:
The paradox is is why do brands have an advantage over non-brands, considering that manufacturing and quality is relatively the same across the industry. Brands should not have an advantage, but they still do. Why?
So there must be something else that is driving the use of marketing among brands.
Possible considerations-Maybe the consumer responds prefers brand that guarantee performance? Or maybe the marketing advantage that firms have provides those firms with the ability to differntiate themselves from their competition?
A addresses the use of marketing, whereas B describes the behavior of consumers. If you think about it, B makes the problem worse-if the consumer already thinks that the non-brand will degrade over time, then what is the difference between now and before the new manufacturing techniques were employed? This seems to indicate that the firm has alwayes had a marketing advantage, and it does not explain why there may be a greater advantage right now.
Those are my thoughts anyway...
A is by no means a sexy answer but, at least is explains why the brands have a greater marketing advantage despite less differentiation among the products.
I chose B initially. But after reviewing the Q and A, here is why I think the answer is A:
The paradox is is why do brands have an advantage over non-brands, considering that manufacturing and quality is relatively the same across the industry. Brands should not have an advantage, but they still do. Why?
So there must be something else that is driving the use of marketing among brands.
Possible considerations-Maybe the consumer responds prefers brand that guarantee performance? Or maybe the marketing advantage that firms have provides those firms with the ability to differntiate themselves from their competition?
A addresses the use of marketing, whereas B describes the behavior of consumers. If you think about it, B makes the problem worse-if the consumer already thinks that the non-brand will degrade over time, then what is the difference between now and before the new manufacturing techniques were employed? This seems to indicate that the firm has alwayes had a marketing advantage, and it does not explain why there may be a greater advantage right now.
Those are my thoughts anyway...
A is by no means a sexy answer but, at least is explains why the brands have a greater marketing advantage despite less differentiation among the products.
