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# Sales of telephones have increased dramatically over the

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Manager
Joined: 06 Jul 2005
Posts: 117
Location: Bangalore, India
Sales of telephones have increased dramatically over the [#permalink]

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22 Oct 2005, 21:29
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100% (04:06) correct 0% (00:00) wrong based on 6 sessions

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Sales of telephones have increased dramatically over the last year. In order to take advantage of this increase, Mammoth Industries plans to expand production of its own model of telephone, while continuing its already very extensive advertising of this product.

Which of the following, if true, provides most support for the view that Mammoth Industries cannot increase its sales of telephones by adopting the plan outlined above?

(A) Although it sells all of the telephones that it produces, Mammoth Industriesâ€™ share of all telephone sales has declined over the last year.
(B) Mammoth Industriesâ€™ average inventory of telephones awaiting shipment to retailers has declined slightly over the last year.
(C) Advertising has made the brand name of Mammoth Industriesâ€™ telephones widely known, but few consumers know that Mammoth Industries owns this brand.
(D) Mammoth Industriesâ€™ telephone is one of three brands of telephone that have together accounted for the bulk of the last yearâ€™s increase in sales.
(E) Despite a slight decline in the retail price, sales of Mammoth Industriesâ€™ telephones have fallen in the last year
Director
Joined: 21 Aug 2005
Posts: 789

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22 Oct 2005, 21:35
E

If mammoth's sales did not increase when there was an overall dramatic increase sales, increasing the production will not increase the mammoth's sales.
SVP
Joined: 05 Apr 2005
Posts: 1710

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22 Oct 2005, 22:07
(C) Advertising has made the brand name of Mammoth Industriesâ€™ telephones widely known, but few consumers know that Mammoth Industries owns this brand.
Manager
Joined: 10 Sep 2005
Posts: 162

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23 Oct 2005, 01:08
D....Mammoth Industriesâ€™ telephone is one of three brands of telephone that have together ALREADY accounted for the bulk of the last yearâ€™s increase in sales. So any new brand will not add substantially to its kitty.
Manager
Joined: 04 Oct 2005
Posts: 246

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23 Oct 2005, 03:55
E by POE

A) If, only strengthens... MI can sell all phones they produce
B) If, only strengthens... MI inventory is declining->sell more than produce
C) Irrelevant. MI could successfully sell the brand-name without letting customers know who the actual owner is.
D) MI posseses 1/3 of the bulk... Bulk can be 51% or 90%...1/3 of that... too vague to safely conclude that the market is at maturity.
E) Lower prices does not lead to higher sales -> market at maturity
Director
Joined: 14 Sep 2005
Posts: 985
Location: South Korea

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23 Oct 2005, 03:59

Even though they expand their productions, customers won't buy their telephones.
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SVP
Joined: 05 Apr 2005
Posts: 1710

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23 Oct 2005, 07:47
HIMALAYA wrote:
(C) Advertising has made the brand name of Mammoth Industriesâ€™ telephones widely known, but few consumers know that Mammoth Industries owns this brand.

i change to E.
Senior Manager
Joined: 04 May 2005
Posts: 279
Location: CA, USA

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23 Oct 2005, 11:43
for E

already not selling well despite price reduction, why produce more ?
Director
Joined: 14 Sep 2005
Posts: 985
Location: South Korea

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23 Oct 2005, 17:20
gamjatang wrote:

Even though they expand their productions, customers won't buy their telephones.

Oops, I meant (E).
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SVP
Joined: 16 Oct 2003
Posts: 1801

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23 Oct 2005, 17:25
E as explained above.
SVP
Joined: 28 May 2005
Posts: 1705
Location: Dhaka

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24 Oct 2005, 13:24
should be E.
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hey ya......

SVP
Joined: 03 Jan 2005
Posts: 2233

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24 Oct 2005, 16:40
This problem looks awfully familiar to the one below.

http://www.gmatclub.com/phpbb/viewtopic.php?p=80182
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MBA Section Director
Joined: 19 Mar 2012
Posts: 3835
Location: India
GMAT 1: 760 Q50 V42
GPA: 3.8
WE: Marketing (Energy and Utilities)
Re: Sales of telephones have increased dramatically over the [#permalink]

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03 May 2015, 16:39
Re: Sales of telephones have increased dramatically over the   [#permalink] 03 May 2015, 16:39
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