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# Rumored declines in automobile-industry revenues are

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Director
Joined: 03 May 2007
Posts: 867

Kudos [?]: 265 [1], given: 7

Schools: University of Chicago, Wharton School
Rumored declines in automobile-industry revenues are [#permalink]

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24 Aug 2007, 11:50
1
KUDOS
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Difficulty:

75% (hard)

Question Stats:

50% (01:23) correct 50% (01:44) wrong based on 89 sessions

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Rumored declines in automobile-industry revenues are exaggerated. It is true that automobile manufactures’ share of the industry’s revenues fell from 65 percent two years ago to 50 percent today, but over the same period suppliers of automobile parts had their share increase from 15 percent to 20 percent and service companies (for example, distributors, dealers, and repairers) had their share increase from 20 percent to 30 percent.

Which one of the following best indicates why the statistics given above provide by themselves no evidence for the conclusion they are intended to support?

(A) The possibility is left open that the statistics for manufactures’ share of revenues come from a different source than the other statistics.
(B) No matter what changes the automobile industry’s overall revenues undergo, the total of all shares of these revenues must be 100 percent.
(C) No explanation is given for why the revenue shares of different sectors of the industry changed.
(D) Manufactures and parts companies depend for their revenue on dealers’ success in selling cars.
(E) Revenues are an important factor but are not the only factor in determining profits.
[Reveal] Spoiler: OA

Last edited by Skywalker18 on 10 Mar 2017, 10:53, edited 1 time in total.

Kudos [?]: 265 [1], given: 7

Senior Manager
Joined: 02 Aug 2007
Posts: 346

Kudos [?]: 50 [0], given: 0

Location: Greater New York City area
Schools: Tuck, Ross (R1), Duke, Tepper, ISB (R2), Kenan Flagler (R2)
Re: Rumored declines in automobile-industry revenues are [#permalink]

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24 Aug 2007, 12:21
I will choose B..Whats the correct answer ?

Kudos [?]: 50 [0], given: 0

Intern
Joined: 03 May 2007
Posts: 44

Kudos [?]: 11 [0], given: 0

Schools: Olin
Re: Rumored declines in automobile-industry revenues are [#permalink]

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24 Aug 2007, 13:46
B

Kudos [?]: 11 [0], given: 0

Director
Joined: 03 May 2007
Posts: 867

Kudos [?]: 265 [0], given: 7

Schools: University of Chicago, Wharton School
Re: Rumored declines in automobile-industry revenues are [#permalink]

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24 Aug 2007, 13:57
I will revel the OA later but can you guys explain why B and not ACDE?

Kudos [?]: 265 [0], given: 7

Manager
Joined: 16 May 2007
Posts: 141

Kudos [?]: 27 [0], given: 0

Re: Rumored declines in automobile-industry revenues are [#permalink]

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24 Aug 2007, 14:09
I think its C

Kudos [?]: 27 [0], given: 0

Senior Manager
Joined: 03 Jun 2007
Posts: 376

Kudos [?]: 16 [0], given: 0

Re: Rumored declines in automobile-industry revenues are [#permalink]

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24 Aug 2007, 14:52
If my understanding is right, this is a weaken question and I feel A weakens the argument. I will be stumped if B is the OA

Kudos [?]: 16 [0], given: 0

Intern
Joined: 16 Apr 2007
Posts: 26

Kudos [?]: 1 [0], given: 0

Re: Rumored declines in automobile-industry revenues are [#permalink]

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24 Aug 2007, 16:33
I would go with C.

Kudos [?]: 1 [0], given: 0

VP
Joined: 09 Jul 2007
Posts: 1098

Kudos [?]: 141 [0], given: 0

Location: London
Re: Rumored declines in automobile-industry revenues are [#permalink]

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24 Aug 2007, 17:10
Fistail wrote:
Rumored declines in automobile-industry revenues are exaggerated. It is true that automobile manufactures’ share of the industry’s revenues fell from 65 percent two years ago to 50 percent today, but over the same period suppliers of automobile parts had their share increase from 15 percent to 20 percent and service companies (for example, distributors, dealers, and repairers) had their share increase from 20 percent to 30 percent.

Which one of the following best indicates why the statistics given above provide by themselves no evidence for the conclusion they are intended to support?

(A) The possibility is left open that the statistics for manufactures’ share of revenues come from a different source than the other statistics.
(B) No matter what changes the automobile industry’s overall revenues undergo, the total of all shares of these revenues must be 100 percent.
(C) No explanation is given for why the revenue shares of different sectors of the industry changed.
(D) Manufactures and parts companies depend for their revenue on dealers’ success in selling cars.
(E) Revenues are an important factor but are not the only factor in determining profits.

I would go with C.
The stem says that manufacturers' share of revenue is decreased while dealers' increased. it is negative correlation, which is very rarely seen in between those two sectors. Overal, no reasoning is give to support the rumored decline. Probably, new entrants in manufacturing have started sharing the sector revenue. Thus ones like Ford lost their revenue to Japanese ones while dealers started upping by diversifying their portfolios with new entrants' cars. But no evidence give to support that makes the statistics weak.

Kudos [?]: 141 [0], given: 0

Director
Joined: 29 Aug 2005
Posts: 855

Kudos [?]: 489 [0], given: 7

Re: Rumored declines in automobile-industry revenues are [#permalink]

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25 Aug 2007, 01:45
I am for B
Fistail wrote:
Rumored declines in automobile-industry revenues are exaggerated. It is true that automobile manufactures’ share of the industry’s revenues fell from 65 percent two years ago to 50 percent today, but over the same period suppliers of automobile parts had their share increase from 15 percent to 20 percent and service companies (for example, distributors, dealers, and repairers) had their share increase from 20 percent to 30 percent.
Bold part is the conclusion. Premises do not support the conclusion.
Whatever the share of sub-sectors, industry-wide revenue slide is uneffected. B does a good job pointing it

Which one of the following best indicates why the statistics given above provide by themselves no evidence for the conclusion they are intended to support?

(A) The possibility is left open that the statistics for manufactures’ share of revenues come from a different source than the other statistics.
(B) No matter what changes the automobile industry’s overall revenues undergo, the total of all shares of these revenues must be 100 percent.
(C) No explanation is given for why the revenue shares of different sectors of the industry changed.
(D) Manufactures and parts companies depend for their revenue on dealers’ success in selling cars.
(E) Revenues are an important factor but are not the only factor in determining profits.

Kudos [?]: 489 [0], given: 7

Manager
Joined: 20 Nov 2006
Posts: 213

Kudos [?]: 18 [0], given: 0

Re: Rumored declines in automobile-industry revenues are [#permalink]

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25 Aug 2007, 05:18
To show that there is decrease in the total revenue of the automobile industry, data to be given supporting the rumored decline. But the premises are showing the percentages of different market segments of the automobile industry. From these percentages we cannot make out whether there is a decline in the revenue. B-correctly states that.

Kudos [?]: 18 [0], given: 0

Director
Joined: 03 May 2007
Posts: 867

Kudos [?]: 265 [0], given: 7

Schools: University of Chicago, Wharton School
Re: Rumored declines in automobile-industry revenues are [#permalink]

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25 Aug 2007, 20:29
thanx everybody

OA is B.

Kudos [?]: 265 [0], given: 7

Senior Manager
Joined: 13 Mar 2012
Posts: 351

Kudos [?]: 196 [0], given: 31

Concentration: Operations, Strategy
Re: Rumored declines in automobile-industry revenues are [#permalink]

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15 Mar 2012, 09:35
B for me but real tough question i must say
_________________

Practice Practice and practice...!!

If there's a loophole in my analysis--> suggest measures to make it airtight.

Kudos [?]: 196 [0], given: 31

Senior Manager
Joined: 13 May 2011
Posts: 297

Kudos [?]: 289 [0], given: 11

WE 1: IT 1 Yr
WE 2: Supply Chain 5 Yrs
Re: Rumored declines in automobile-industry revenues are [#permalink]

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24 Apr 2012, 09:24
The source of this Question is PowerScore CR Bible, pg 273. Moderator:please tag.

Knowing total market share is 100%, no matter what happen, direct you to B only.

Kudos [?]: 289 [0], given: 11

Re: Rumored declines in automobile-industry revenues are   [#permalink] 24 Apr 2012, 09:24
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