Sales of telephones have increased dramatically over the last year. In

The premise says that:-
".....while continuing its already very extensive advertising of this product."

The conclusion says that:-
the company wants to expand the production of its own telephone models BECAUSE "Sales of telephones have increased dramatically over the last year...."

The company could not make large sales despite good advertisement.

(E) suggests that even though the company reduced the price the sales fell down.This means that there is no such shortage of the products but rather the quality is not up to the mark so that people can buy it.

the key is the words "in order to take advantage of this increase". these words show the assumptions that are being made.
in particular, the passage assumes that an overall increase in telephone sales, industry-wide, will automatically translate into an increase in sales for mammoth industries.

choice (e) severs this connection completely - it showed that mammoth's sales dropped as the industry-wide sales increased sharply - and so utterly destroys this assumed connection.

Hi

A is not correct as it doesn't allow us to deduce anything that actually has an effect on the argument. It doesn't even imply that mammoth's sales themselves have actually gone down. it says only that mammoth's share\proportion - of the sales has decreased, but that's not the same as saying that the sales themselves have actually decreased. Hope this clarifies

I guess the answer is .

Mammoth Industries plans to expand production of its own model of telephone --- BECAUSE --- Sales of telephones have increased dramatically over the last year and it wants to take advantage of the situation.

We are asked a question as to why they might not be successful in doing so/ why this might not be such a good plan.

(A) Although it sells all of the telephones that it produces, Mammoth Industries' share of all telephone sales has declined over the last year.
If it sells whatever it produces...this means that they are meeting their targets and so might be the case this time too. Doesn't tell us why this is not a good plan. INCORRECT

(B) Mammoth Industries' average inventory of telephones awaiting shipment to retailers has declined slightly over the last year.
If the inventory or stock has declined, it means either the consumption is more or production is less. We are not sure which is he case and hence it doesn't tell us why this is not a good plan. INCORRECT.

(C) Advertising has made the brand name of Mammoth Industries' telephones widely known, but few consumers know that Mammoth Industries owns this brand.
Out of scope. Doesn't tell us why this is not a good plan. INCORRECT.

(D) Mammoth Industries' telephone is one of three brands of telephone that have together accounted for the bulk of the last year's increase in sales.
If they are producing a brand that accounted for the bulk in sales. This might be a good idea. We are hunting for - why this might not be a good idea. INCORRECT.

(E) Despite a slight decline in the retail price, sales of Mammoth Industries' telephones have fallen in the last year.
What ??? They were not able to sell despite of decline in retail price. Then this definitely is not a good plan. CORRECT

Folks,

(A) Although it sells all of the telephones that it produces, Mammoth Industries' share of all telephone sales has declined over the last year.

Mammoth sells all its inventory of telephones.However, the SALES FOR TELEPLHONES in the INDUSTRY has risen in a year , but MM Industries' share of ALL TELEPHONES has declined over last year.

Example:

Last year : MM sold 10 and Total Telephones 100 = 10%
This year : MM sold 10 and Total Telephones 200 = 5% Option (A) says this.

Now MM just looked the rise in Total Telephones from 100 to 200,ignoring the FACT that the rise in Total didn't cause rise in SALES for MM Industries, planned to expand the production and increase in advertising.But the fact is that the Total Sales increase caused increase in SALES of some other XYZ industries and not MM industries

So Expanding the production and advertising won't lead to SUCCESS.

Plz Advice

Rgds,
TGC !!

Got this on GMATPrep:

Got this one wrong since I misread the question.

Industry wide increases in sales of telephones over last year.

However, since MI's sales have fallen last year and there was an industry wide increase in sales of telephone, MI sales cannot be increased this year too by the stated plan.

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?


Plan: Expand production, maintain extensive advertising
We need an answer to prove that PLAN won’t increase sales of MI’s phones

(A) Although it sells all of the telephones that it produces, Mammoth Industries' share of all telephone sales has declined over the last year.

- Mammoth has sold all its phones, and according to the prompt, it has expanded production (therefore, more sales & profit, since it was able to sell all)
- Mammoth’s share in telephone sales is irrelevant on whether Mammoth can increase or decrease its sales

(B) Mammoth Industries' average inventory of telephones awaiting shipment to retailers has declined slightly over the last year.- So if Mammoth expands production, inventory will increase, therefore, shipment (sales) will increase

(C) Advertising has made the brand name of Mammoth Industries' telephones widely known, but few consumers know that Mammoth Industries owns this brand.- Irrelevant in terms of sales

(D) Mammoth Industries' telephone is one of three brands of telephone that have together accounted for the bulk of the last year's increase in sales.
- Last year’s sales is irrelevant
- Mammoth has only increased its sales this year

(E) Despite a slight decline in the retail price, sales of Mammoth Industries' telephones have fallen in the last year.- Correct answer because we know that expansion of production will not address the issue as the fact that there was a decline in the retail price and consequently a decline in sales suggests that there may be external factors as to why the phones are not selling
- Increasing supply without a corresponding demand will result to declined sales or loss

(A) Although it sells all of the telephones that it produces, Mammoth Industries' share of all telephone sales has declined over the last year.

This a classic trap answer.

Whenever you see %age decrease an immediate thought pattern should occur in your mind that numbers must be increasing somewhere. (GMAT Pattern) Here is how -

1 yr ago -

Let Mammoth Industries' market share be - 55%
Total number of handsets sold be - 100
Number of handsets Mammoth Industries sold - 55 handsets.

Today -

Mammoth Industries' share of all telephone sales has declined over the last year.

Let Mammoth Industries' market share be - 50% (reduced from 55%)
Total number of handsets sold be - 1000
Number of handsets Mammoth Industries sold - 500 handsets.

i.e. Mammoth Industries sold more handsets than last year, even though market share has declined as you can see above. Since we have to destroy this option we increased the market size (one extreme). It is a variable quantity and you should use it to your advantage.

Takeaway - If you have to weaken a %age decrease option/question then immediate find an answer choice that says the total number must have increased somewhere.

Here is another problem using the same concept -

in-the-united-states-of-the-people-who-moved-from-one-state-136004.html

Clearly B, C, and D are wrong.

A: take an example to understand why it is wrong:
The year before last year: Industry sold 100 (assume) phones, MI sold 30 phones. --> Market share of MI = 30%
Last year: Industry sold 200 (assume) phones. If market share of MI declined last year --> MI sold less than 60 phones last year (because in the year before last year, MI's market share = 30%, if it sold more than 60 phones, its market share would be at least 30%). Even when MI sold 50 phones, it still increased production compared with the year after last year --> support the plan of MI. --> Wrong.

E: The sale of phones in the industry increased last year (e.g. from 100 phones to 200 phones as previously mentioned). However sales of phone fell (e.g. lower than 30 phones as previously mentioned) even when it reduced phone's unit price. --> clearly no more production should be applied for this or next year --> the original plan cannot increase the sales of phones

A. Market share is out of scope since passage talks about the overall sales volume. It is still possible that market share will be lower than last year however total sales increased.
E. If Mammoth sales dropped last year then we have no adequate precondition for its increase in nearest future, hence it completely shutters the argument and Correct choice.

I have a slightly different approach, check this out:

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.

Conclusion: Mammoth Industries cannot increase its sales of telephones by adopting the plan outlined above

Very important to understand: Sales of telephones have increased in the economy generally! How do I show that Mammoth Industrie's plan will not work out? Well, if we have clear evidence/observation what has happened last year to Mammoth Industrie.


(A) Although it sells all of the telephones that it produces, Mammoth Industries' share of all telephone sales has declined over the last year. Wrong - share is not important as Mammoth still could increase its sales (Absolute vs Relative)

(B) Mammoth Industries' average inventory of telephones awaiting shipment to retailers has declined slightly over the last year. Wrong - Irrelevant because how does it affect its sales? No clear link to the increase of sales

(C) Advertising has made the brand name of Mammoth Industries' telephones widely known, but few consumers know that Mammoth Industries owns this brand. Wrong - clearly, irrelevant

(D) Mammoth Industries' telephone is one of three brands of telephone that have together accounted for the bulk of the last year's increase in sales. Wrong - clearly, irrelevant

(E) Despite a slight decline in the retail price, sales of Mammoth Industries' telephones have fallen in the last year. Correct - Must be taken as true, so if sales (direct link!!) have fallen last year + Mammoth Industrie keeps producing + advertising the same model -> Why should there be a change in their sales?

Therefore E) is the correct answer.

[quote="gmatdummy01"]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?


REASON:Did not PRETHINK or STATE THE GOAL clearly.
My approach
Continued increase In Production and Extensive advertising cost will not lead to increased sales.

A.Price of share and sales not related.

B.doesnt help..invetory decline ..to some extent it stengthens..the fact thhat there shuld be increase in PRODUCTION.

C.It doesnt matter whether few people know wh knows the brand as long as the sales are good.

D.Good thing ..but doesnt help.

E.It isstated in tye passage that mammoth was increasing production and exptensive advertising from last year and now the plan is to continue the same.But if inspite of this sales declined last year--then now if it increases production --IIt wont help. So this completly fits our stated GOAL.

A. Since the whole market has increased dramatically over the last year, the decrease of MIs' share doesn't mean decrease in sales. MI's sales could increase or decrease. So we cannot determine whether MI's products are becoming unattractive.

B. This statement indicates that the speed of sell was quicker than that of production. For example, the average inventory of telephones awaiting shipment to retailers was X before the increase of the whole market. Last year the average inventory became X/2. That means retailers can't wait so long. In other words, MI's telephones were highly demanded last year. So MI should expand production.

C. We don't care. For example, everyone knows Zara, but few know its owner Inditex.

D. In fact, it tells us that MI experienced increase last year. So expanding production is a good strategy.

E. When price went down, people still didn't want to buy MI's products. That means MI's phones are not attractive. What a big problem!

HI GMATNinja, mikemcgarry, DmitryFarber, MagooshExpert (Carolyn), ccooley, GMATGuruNY, AjiteshArun EMPOWERgmatVerbal, EducationAisle, generis, jennpt, VeritasPrepErika, MartyTargetTestPrep

Can you please help me with the below question.

Sales of telephones have increased dramatically over the last year

Does it not go against premise?

E.Despite a slight decline in the retail price, sales of Mammoth Industries' telephones have fallen in the last year.

The first sentence ("Sales of telephones have increased dramatically over the last year") is a general statement. Telephone sales have increased dramatically in general. Does that mean sales have increased for every single company that sells telephones? Not necessarily.

For example, automobile sales may have increased dramatically in the United States last year. But sales of Hummers may have plummeted that same year. Even if some individual companies saw decreased sales, we would still say that automobile sales (in general) increased dramatically.

Likewise, even though sales of telephones have increased dramatically over the last year, that doesn't not necessarily mean that Mammoth Industries' telephone sales have increased.

I hope that helps!

Quick question regarding Option D -
Since Mammoth along with 2 other brands accounted for bulk of last year's sales, the market might have already reached a saturation point. So even with continuing the already extensive advertising the sales might not increase. Even from the premise, Mammoth might have already taken advantage of the dramatic increase in sales last year and there is no mention of current market demand. Why can this not be a possibility?

As a counter for option E -
Aren't these two events independent
1. The decline in sales last year
2. The possibility of no future increase in sales with expanding production and continuing the advertising.
Also, referring to the "slight decline in retail price" part, slight decline could mean 1 cent or any $ amount. Either way we do not know if it was substantial enough to effect the sales. Is n't this option too ambiguous?

Thanks

To answer the question, we are looking for the answer choice that "provides most support for the view that Mammoth Industries cannot increase its sales." So a couple of answer choices could leave open the possibility that Mammoth cannot increase its sales -- our task is to determine which provides the most support for this position.


To go with (D), you have to make the assumption that Mammoth's increase in sales last year have saturated the market. This assumption is not supported by the passage -- while it is possible that the increased demand for Mammoth phones was just a one-year phenomenon, you can't conclude that this is true based on the given information.

If anything, the information in (D) makes it more likely that Mammoth's plan will succeed -- demand is up, so the advertising campaign is working! Nothing indicates that this trend will reverse itself, so it seems like a good time to produce more telephones.


(E), on the other hand, paints a different picture: sales of Mammoth phones have fallen in the past year, even if the industry as a whole is doing well. Mammoth even decreased its retail prices, and yet demand for their product is still down.

So what do Mammoth executives plan to do? They will continue with the same advertising program -- which was clearly not very effective, as sales are down -- and just produce more telephones. Because demand declined last year and Mammoth is not doing anything to address this issue, simply increasing production will not somehow increase sales.

(E) provides strong support for the position that Mammoth cannot increase its sales with the given plan, so (E) is the correct answer.

I hope that helps!