It is currently 19 Mar 2018, 23:18

### 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

we will pick new questions that match your level based on your Timer History

Track

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

# Events & Promotions

###### Events & Promotions in June
Open Detailed Calendar

# Questions 19-20 are based on the following. Surveys show

Author Message
Senior Manager
Joined: 26 May 2009
Posts: 278
Questions 19-20 are based on the following. Surveys show [#permalink]

### Show Tags

28 Jun 2009, 17:20
00:00

Difficulty:

(N/A)

Question Stats:

0% (00:00) correct 100% (00:00) wrong based on 1 sessions

### HideShow timer Statistics

Questions 19-20 are based on the following.
Surveys show that every year only 10 percent of cigarette smokers switch brands. Yet the manufacturers have been spending an amount equal to 10 percent of their gross receipts on cigarette promotion in magazines. It follows from these figures that inducing cigarette smokers to switch brands did not pay, and that cigarette companies would have been no worse off economically if they had dropped their advertising.
19. Of the following, the best criticism of the conclusion that inducing cigarette smokers to switch brands did not pay is that the conclusion is based on
(A) computing advertising costs as a percentage of gross receipts, not of overall costs
(B) past patterns of smoking and may not carry over to the future
(C) the assumption that each smoker is loyal to a single brand of cigarettes at any one time
(D) the assumption that each manufacturer produces only one brand of cigarettes
(E) figures for the cigarette industry as a whole and may not hold for a particular company
Manager
Joined: 14 May 2009
Posts: 137
Schools: AGSM '16

### Show Tags

28 Jun 2009, 18:59
I would probably go with B.
Intern
Joined: 13 Jun 2009
Posts: 31
Location: Delhi, India
Schools: CBS, Wharton, LBS, Kellogg

### Show Tags

28 Jun 2009, 19:47
I would go with C

B - May or may not carry into the future. If it does, then the expenditure is useless.
C - If I assume that loyalties switch, I am giving my brand good visibility by advertising.
_________________

Director
Joined: 23 May 2008
Posts: 760

### Show Tags

28 Jun 2009, 20:04
was stuck between C and D, will go with C
Manager
Joined: 14 May 2009
Posts: 137
Schools: AGSM '16

### Show Tags

28 Jun 2009, 20:10
Does anyone know the OA?
Senior Manager
Joined: 26 May 2009
Posts: 278

### Show Tags

28 Jun 2009, 20:55
OA is E. Does someone think of a better explanation . I was thinking of C.
Intern
Joined: 13 Jun 2009
Posts: 31
Location: Delhi, India
Schools: CBS, Wharton, LBS, Kellogg

### Show Tags

29 Jun 2009, 00:41
Personally , I don't think E makes any sense at all. The passage does not talk abt ' a particular company' anywhere ..
_________________

Senior Manager
Joined: 15 Jan 2008
Posts: 269

### Show Tags

30 Jun 2009, 00:28
I think E is the only answer.

becoz, its known that 10% of the ppl switch brands and the cig manufacturers spend around 10% of their gross receipts for advertising the cigarettes.

Conclusion is about the whole industry i.e even if it didnt spend that money, they will anyways get the customers and the overall gross receipts will remain same for the industry.

But if we take the case of single company, the company may spend around 10% but get the loayality of all customers ( 10%).
i.e the advertising money they spend may be lesss and the money they generate through switched customers may be more.
Re: Cigarettes..   [#permalink] 30 Jun 2009, 00:28
Display posts from previous: Sort by

# Questions 19-20 are based on the following. Surveys show

Moderators: GMATNinjaTwo, GMATNinja

 Powered by phpBB © phpBB Group | Emoji artwork provided by EmojiOne Kindly note that the GMAT® test is a registered trademark of the Graduate Management Admission Council®, and this site has neither been reviewed nor endorsed by GMAC®.